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Decision of Polish Supreme Administrative Court/Cyprus investment funds exempt from tax in Poland

Contributed by Fiducenter
18 September, 2015


The case involved a private investment fund registered in Cyprus (the Applicant), which applied to the Ministry of Finance of Poland for a ruling with regards to its right to benefit from the corporate income tax exemption applicable in Poland to collective investment institutions.

As per the Corporate Income Tax Law of Poland, collective investment institutions which have their registered office in a Member State of the European Union other than the Republic of Poland, or in another Member State of the European Economic Area, are exempt from corporate income tax in Poland if, among other things:

  • they are subject to tax on their worldwide income in the state of their registered office,
  • the sole purpose of their activity is collective investment of funds raised in public or privately, and
  • they are managed by entities that operate on the basis of a permission issued by the competent authorities supervising the financial market in the state in which their registered office is located.

The Applicant asked for confirmation that entrusting the management of a fund to a manager, being an investment company with a legal status, the condition for the exemption referred to in the Polish Corporate Income Tax Law would be met.

The ruling provided on behalf of the Polish Ministry of Finance rejected the position of the Applicant on the grounds that the scope of the management of an investment company is narrower than the management of a fund referred to in the relevant section of the Corporate Income Tax Law.

The Applicant appealed to the court of the first instance, which upheld the unfavourable individual ruling in this regard on the grounds that the powers of the company managing investment activity (investment manager) overlap with the powers vested in the management board of a capital company as the body authorized to manage the company's affairs and represent the company with regard to third parties. Continue Reading >>


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