Obtaining an Investment
Support Decision

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The slogan “All of Poland as a Special Economic Zone” means that every zloty spent on starting up new production, changing the organization of ongoing production or increasing production capacity may qualify for income tax exemption.

To qualify, you must first obtain a document referred to as an “Investment Support Decision”. What does such a document mean in practice? That the enterprise will be eligible for state aid, in the form of income tax exemption (CIT or PIT), towards the expenditure incurred to acquire tangible and intangible assets or the two-year employment costs of new jobs created. The aid ceiling will depend on the amount invested or the cost of employment, on the location (in less developed regions, with a higher unemployment rate, more support is available) and enterprise status (SMEs can count on higher exemptions). There are also Quality Criteria, which are used to assess compliance of the investment as a whole with the Government’s Strategy for Responsible Development for 2020 (looking ahead to 2030).

New rules

In 2018, a new investment support system will come into effect, replacing the existing system of permits to operate in a Special Economic Zone. The new rules will make it possible to obtain support regardless of the place of investment, not – as it has been to date – only if it is based within the relevant zone.

How may we be of assistance?

  • Feasibility analysis of obtaining an Investment Support Decision, including the assessment of compliance of the planned investment with the requirements to obtain a support decision
  • Simulation of the amount of state aid available
  • Comprehensive support in the Investment Support Decision procedure, including preparation of the necessary application documents, participation in negotiations, verification of correctness of the decision received
  • Review of expenditure in terms of impact on the amount of public aid
  • Current advisory services related to accounting for state aid (determining the tax exemption amount, division of income and deductible expenses between taxable and exempted sources, documentation)
  • Recommendations for changes in internal documents and policies
  • Validating the right to use state aid through obtaining individual interpretations
  • Comprehensive support in the event of tax audits and inspections related to the income tax exemption (consultations, drafting documents, representation in relations with tax authorities)

*as specified in the Regulation of the Council of Ministers of 30 June 2014 on the mapping of regional aid for 2014–2020 (Journal of Laws of 2014, item 878)
**As of the date of entry into force of the new regulations, the clause introduced in the new system will also apply to the holders of permits issued under the “old” rules.

Who is the Investment Support Decision for?

The Investment Support Decision is available to taxpayers planning a new investment project, defined as investing in tangible and/or intangible assets associated with setting up a new business establishment, increasing the production capacity of an existing one, diversifying production by introducing products not previously made at the current location or a fundamental change in the production process. Specific regulations will define activities that will not be eligible for support; however, this will only apply to a small number of business sectors.

How much can you gain?

The amount of exemption depends on the so-called Aid Intensity Factor which, to put it simply, determines the percentage of eligible expenses which can be included in the income tax exemption. The aid intensity depends on the region of the country:

The amount of aid is also related to the status of the enterprise (micro / small / medium) within the meaning of EU regulations. The maximum regional aid intensity under general principles:

  • goes up by 20 percentage points gross for micro and small enterprises, and
  • by 10 percentage points gross – for medium-sized enterprises.

Quality Criteria

In order to qualify for an Investment Support Decision, the given investment must satisfy the Quality Criteria. In essence, it means that the project as a whole must comply with the Government’s Strategy for Responsible Development for 2020 (looking ahead to 2030). For an application to be approved, the project must score, depending on the region, between 4 and 6 points (out of 10 possible).

The evaluation process will include such areas as:

  • Sustainable development (location in regions with a high unemployment rate, in smaller towns; size of the enterprise).
  • Structural development (consistency of the subject of the investment with the national development strategy, creation of specialized, well-paid jobs).
  • Scientific development (research and development, cooperation with research centers and academic institutions).
  • Human resources development (remuneration, employment stability, additional benefits for employees).