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Double taxation? Corporation Tax in Poland and UK company. How does it work?!


paulinska 9 | 86
3 Dec 2012 #1
So, a Public Accounts Committee (UK) are saying the HMRC (Taxman) needs to be more aggressive and assertive in confronting corporate tax avoidance. The Committee suggests that all companies based outside the UK should pay taxes on profits made here in the UK. However, in accordance with UK tax law, non UK based International companies don't pay corporation tax. Companies like Amazon & Starbucks make millions in profits that are tax free. I'm sure these companies pay taxes wherever they're based. Should they be paying 'double' taxes?! If you own a successful business e.g Polska Sklep, based and registered in Poland but with operations in the UK, should we expect you to pay taxes on your profits here in the UK? What's the guidance on corproration tax for companies based outside Poland in accordance with Polish tax law?! As Poles, do you expect these companies to be paying taxes on profits made in Poland?
Looker - | 1,103
27 Oct 2014 #2
Check out these documents:

UK/POLAND DOUBLE TAXATION CONVENTION

hmrc.gov.uk/taxtreaties/in-force/uk-poland-dtc.pdf

CONVENTION BETWEEN REPUBLIC OF POLAND AND THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME AND ON CAPITAL GAINS

finanse.mf.gov.pl/documents/766655/1155165/20060720_WlkBrytania_konwencja_tekst_ang.pdf
ustaxconsultant
27 Oct 2014 #3
Hi, Paulinska,

HMRC is getting more aggressive in pursuing taxpayers, both corporate and individual. Generally, the cited by Looker provides relief for double taxation where a treaty resident has income sourced to and is taxed by the other treaty state. The structure of your overseas business (or in Poland in this case) would also be relevant - if it is a branch of the UK company, profit and loss could potentially be consolidated for UK tax reporting although an election for branch exemption is available.

Hope this helps!
jon357 69 | 18,529
28 Oct 2014 #4
Paulinska, those Polish shops in the UK are generally (probably without exception) registered there rather than in Poland where the regulations concerning accounts and taxation are much less favourable.
RunAway - | 1
27 Jul 2016 #5
Merged: Polish Company Formation - as a subsidiary of my UK company

Hi - I'm going to be working in Poland for 3-5 months each year for the next few years. I want to set up a company in Poland as a subsidiary of my UK company.

Does anyone have any information on how easy / difficult this is?
And how easy it is to transfer funds to the parent company - as I'd rather keep my corporation tax affairs in the UK for now, but he Polish company would pay me wages, Polish income tax, social security etc for the time worked in Poland.

Thanks


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