Starting from 2022, there is a new incentive aimed at investments in Poland for enterprises incurring costs related to expansion of their business. Such taxpayers can include additional deduction of qualified costs not exceeding PLN1 million (m) (approximately US$250,000) for boosting sales of products developed by them. The maximum tax benefit due to the relief will be PLN 190,000 per year. The incentive does not apply to sales to related parties. Some further conditions need to be met.

Which costs can qualify?

The “expansion relief” is introduced for companies that decide to develop their business and find new markets. The relief will apply to expenses incurred in order to increase the sale of products (participation in fairs, promotional activities, preparation of the necessary documentation). The relief applies only to products developed by the taxpayer, therefore wholesalers and retailers are out of the scope of the tax relief. The product may be an item already produced by the taxpayer, as well as items not yet offered by the taxpayer and not yet offered in given country.

The expansion relief covers expenses incurred for:

  • participation in fairs;
  • promotional and information activities;
  • adaptation of product packaging to the requirements of contractors;
  • preparation of documentation enabling the sale of products, in particular concerning the certification of goods and registration of trademarks;
  • preparation of documentation necessary to participate in tenders and to submit offers to other entities.

How can you benefit from the expansion relief?

The tax relief is addressed to entrepreneurs who are PIT or CIT taxpayers. It allows the entrepreneur to settle the costs incurred to increase sales of products twice – once by recognising the expense as a tax-deductible cost and a second time by reducing the taxable amount when filing the annual return. The relief may be settled on an ongoing basis.

If product is an item already produced and offered by the taxpayer, the relief applies provided that in the period of 2 consecutive tax years, counting from the tax year in which he incurred the costs, he increased the revenues from the sale of products in relation to the revenues in this respect established on the last day of the tax year preceding the year in which these costs were incurred. In case of new products, in the period of 2 consecutive tax years first revenues should be achieved.