The Ministry of Finance published a draft regulation on the postponement of the date of entry into force of the regulation according to which entities paying dividends, interest, or royalties in an amount exceeding PLN 2 million would be absolutely obliged to deduct the withholding tax at the national rate (19 or 20 per cent), irrespective of any applicable exemptions or reduced tax rates resulting from directives or international treaties.

This is a further postponement of the date of entry into force of the provisions in question. Originally, their applicability was postponed until 30 June 2019, and then until 31 December 2019. The Ministry of Finance now plans a further postponement until 30 June 2020. The Ministry explains that the new date of the postponement of the applicability of the provisions is to coincide with the amending of the recently adopted regulations on deducting withholding tax. However, at this stage nobody knows what the amendment concerned would specifically cover. The proposed amendment means that, at least until 30 June 2020, entities paying dividends, royalties, or interest do not need to adhere to the statutory limit of PLN 2 million and unconditionally deduct withholding tax should this limit be exceeded. To deduct withholding tax according to the reduced rate or apply the tax exemption, it will be necessary to exercise due diligence when verifying the recipient of the due amounts, including the correct determination of the beneficial owner.

The Ministry of Finance has also decided to exempt the application of the aforementioned regulation with respect to State Treasury bonds offered on the Polish market (the exemption has only, so far, applied to bonds offered on foreign markets).