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AD REVENUE WITHOUT IP BOX RELIEF – NEW INTERPRETATION ISSUED BY POLISH TAX AUTHORITIES

A producer of free computer games does not earn money by selling them, but by advertising. Therefore, he pays a higher tax than the one who provides games for a fee – according to the interpretation of the director of the Polish National Tax Information.

As a result of this interpretation, the situation of producers (so-called developers) of paid and free games is diversified: the former are not entitled to the IP Box tax relief, the latter indeed are.

Premium games

The IP Box relief in Poland consists in taxing income from qualified intellectual property rights at a preferential rate of 5% of personal income tax or corporate income tax. It concerns, among others the income from fees or charges under the license agreement (Article 30ca (7) (1) of the Polish PIT Act and analogous Article 24d (7) (1) of the Polish CIT Act). In practice, therefore, a person who buys a game from the producer (developer) signs a license agreement with him.

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IP BOX TAX RELIEF IN POLAND

On August 24, 2018, the Polish Ministry of Finance published a draft act amending the act on personal income tax, the act on corporate income tax. One of the proposed changes was the introduction of preferential taxation of income from intellectual property rights (the so-called “IP Box” or “Innovation Box” relief).

Innovation Box – IP Box allowances – were introduced to the Polish Personal Income Tax Act (“PIT”) and to the corporate income tax (“CIT”) as a preferential form of taxation (preferential taxation of earned income) for entrepreneurs obtaining income from commercialization of intellectual property rights. Qualified intellectual property rights are obtained after submitting an application to the appropriate body – then it is possible to take advantage of this relief.

IP Box has been implemented in other countries, including: the Netherlands, Great Britain, Ireland, Luxembourg.

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Investment potential and options in Poland for international investors

The scale of international investment in Poland in recent years

According to analyses, 2021 a record year in terms of the number and value of investments in Poland. From the beginning of the last year, 402 investment support decisions were issued. By analogy, in the same period last year this was a difference of 56%. The value of investments in 2021 was approximately 17.3 billion PLN, which is an increase of 14% compared to the whole of 2020.

Since the beginning of the Polish Investment Zone (which is an instrument thanks to which one can obtain tax relief for the realization of a new investment, which can be used throughout Poland, regardless of the size of the company. Such support is granted to companies from the industrial and modern services sector), 1209 decisions on investment support have already been issued. 2021 declarations accounted for 33% of the total and were declarations of over 9500 new workplaces.

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POLISH SPACE SECTOR

Since Poland became the member of the European Space Agency in 2012, Polish space sector has been rapidly grooving.

Despite continuous development, Polish space companies focus mainly on niches. They manufacture high quality products mainly for the European Space Agency, as well as national agencies. An example of success in such a niche is Astronika, which regularly wins international tenders to provide specialised instruments for space agencies and private companies. One of its greatest achievements is the supply of parts for the penetrator mounted on the Mars Insight probe.

Until now, Polish companies have mainly been sub-suppliers of instruments, which were later assembled into a finished product by an integrator. Therefore, the main challenge facing entities of the Polish space sector is to advance in the supply chain and achieve higher margins.

The NewSpace revolution

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KIELTYKA GLADKOWSKI KG LEGAL PARTICIPATES IN FINCRIME FOCUS: SANCTIONS

In light of recent events, concerns are rising over the limits and impact the use of Cryptocurrencies in the enforcement of Sanctions could be. KIELTYKA GLADKOWSKI will participate in the event FinCrime Focus: Sanctions on the 30th of March 2022.

The speakers will clarify the intricacies of the Sanctions and Counter-Sanctions influence, limits, scenarios, and impact of the use of Cryptocurrencies in the enforcement of both Russia and Ukraine’ to explore, including the following issues:

– How we should no longer only be concerned about Sanctions lists;

– To what extent that these countermeasures can be positive (inclusion in other lists) or negative (blocking statutes);

– How enforcement is possible when payments are made through Crypto.

The speakers will include:

Leigh-Anne Moore, Regulatory & Compliance Consultant;

Joshua Ray, Partner, Rahman Ravelli Solicitors;

Angel Niño Torres, CEO, FTT Lawyers (Venezuela);

Francis Bond, Solicitor, Macfarlanes LLP

Link to the event: https://www.grcworldforums.com/fincrime/fincrime-focus-sanctions

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