The popularity of limited partnerships results from the limited liability of limited partners up to the sum of the limited partnership. At the same time, the liability of the general partner is unlimited, therefore in practice this function is often performed by limited liability companies. Therefore, taxpayers could benefit from the lack of double taxation (as in the case of a limited liability company or joint-stock company), while limiting the liability of business activity.
The Ministry noticed the above dependence and decided to cover limited partnerships with CIT from January 1, 2021, which in practice means double taxation of the company and profit payments to partners. Therefore, a number of questions and doubts have arisen as to whether limited partnerships will be able to take advantage of the preferences in the form of a reduced tax rate to 9%.
Conditions for using the 9% rate
Corporate income tax payers may take advantage of the 9% income tax rate. The 9% rate applies to revenues other than from capital gains, subject to certain conditions. The application of the reduced rate is a tax preference, therefore tax offices attach great importance to the fulfillment of formal conditions.
The main condition for taking advantage of the tax relief is the appropriate amount of last year’s and current revenues. Taxpayers may take advantage of the relief if the revenues generated in a tax year do not exceed the amount expressed in PLN, corresponding to the equivalent of EUR 2 million, converted at the average EUR exchange rate on the first business day of the tax year. This limit was increased from January 1, 2021 from 1.2 million euros that was in force in previous years.