Tax audits in Poland. What will be the target of tax authorities in 2025?

This article will answer the following questions:

• How many tax audits were conducted in 2024 in Poland?
• Which tax settlements are investigated most frequently?
• How to minimise the risk of tax audits in a Polish business?

How did tax authorities proceed with their activities in the past year, and how many tax audits and checking activities can Polish taxpayers expect in the years to come? Professional tax advisors representing taxpayers before the tax authorities have no doubt: in the near future we can expect increased activity of the tax authorities in terms of checking activities.

Tax audits in 2024 – what and how often did tax authorities investigate in Poland?

In 2024, the number of tax audits dropped compared to the previous year. 

The number of tax audits completed in 2023 in Poland was 13,023, while in 2024 there were 9,829. The number of customs and fiscal audits also fell, but in their case the decrease was insignificant: 7,186 audits were completed in 2023, while in 2024 – 7,043. 

However, the decrease in the number of tax as well as customs and fiscal audits does not mean that the tax authorities have limited their activity but rather, in order to verify the correctness of settlements, tax authorities are more eager to conduct verification activities as it is a less formalised, faster and more convenient form of controlling taxpayers. This trend can be traced in statistics, showing that the number of verification activities is growing – in 2024, as many as 2,393,739 were carried out – over 110,000 more than in 2023. One of the reasons for such a staggering number is probably the fact that the verification activities procedure is not limited in time, as in the case of a tax audit, and under this procedure tax authorities can check the correctness of settlements in given periods as often as they wish.

When analysing the available statistics, we may come to the conclusion that verification activities are a tool that is used to examine the correctness of tax settlements, while tax as well as customs and fiscal audits take place when the taxman expects to detect irregularities at a given taxpayer. This is evidenced by the high efficiency (i.e., the rate of irregularities identified in taxpayers' settlements in the course of audits) of both tax (99%) as well as customs and fiscal audits (98%). It seems interesting that the efficiency of tax audits is higher than the one set to be achieved in 2025. According to the Regulation of the Minister of Finance on defining the directions of action and development of the National Revenue Administration for 2025-2028, the assumed efficiency of marking taxpayers as audit targets in 2025 is 93.1%.

The tax office keeps an eye on withholding tax and tax avoidance

Most tax as well as customs and fiscal audits still concern VAT. Tax authorities focus primarily on detecting abuses related to carousel frauds.

Over the last two years, experts providing professional tax advisory services to businesses have observed a significant increase in the tax authorities’ interest in withholding tax - this is the main reason for investigating large entities investing in Poland. During the process of validating WHT settlements, tax authorities are more and more willing to exploit the possibility of exchanging information with tax authorities from other countries and check whether the entity to which the Polish taxpayer has paid its dues actually conducts business in its country and can be considered the actual beneficiary of the funds paid by the Polish company. Proceedings in this regard are usually lengthy, as exchanging information with other countries is a time-consuming process.

It is also worth noting here that the activities of the tax authorities do not end there, the subject of interest of the tax authorities during the audit of WHT settlements is also the right to claim tax exemptions or preferences in the form of applying a reduced tax rate, which results from a double taxation avoidance agreements with the country in which the recipient of the funds is located.

The taxman also conducted nearly 30 investigations into the application of the general anti-avoidance clause. This number is not substantial, but it can be expected that the tax authorities' interest in this area will only grow. Taxpayers, therefore, should strive to reduce the risk of being considered artificial or lacking economic justification already at the stage of carrying out transactions.

Audits are also conducted in the area of transfer pricing - the scope of documentation is usually wide, so the tax authorities look into them carefully. Auditing authorities carry out analyses and comparisons based on databases, and thus are able to determine the course of individual transactions and investigate them in terms of market conditions.

Tax audits – forecasting 2025 trends and tax risks

With a high degree of probability, it can be assumed that in 2025 tax authorities will continue to have withholding tax on their radar. Intense audits can also be expected in the area of VAT, which is the main source of state budget revenues and is always on top of the list of most frequently audited taxes. The entities under audit are primarily those operating in sensitive industries (such as transport, fuel or construction) and companies that purchase intangible services of significant value (especially from related parties). As to PIT and CIT, there has been no increase in revenue to the state budget from them in the last year, which is why they may be a subject of increased interest to the tax authorities in 2025.

Entrepreneurs in 2025 and beyond should certainly also expect tax authorities to be really proactive in carrying out auditing activities. Since the efficiency of marking business entities as targets of tax audits is one of the indicators of the effectiveness of the National Revenue Administration, the tax authorities will resort to this tool only when, based on the data in their possession, they expect to identify irregularities at a given taxpayer. On a day-to-day basis, in order to validate settlements, tax authorities will rather limit themselves to carrying out verification activities.

Significantly from the perspective of taxpayers, the verification activities procedure is largely simplified and the provisions on the collection of evidence by tax authorities do not apply to it. Tax authorities often do not inform entrepreneurs of this, and as a result, they request tons of documents and data in the course of verification activities, which taxpayers are not obliged by law to provide.

How to mitigate the risk of tax audits and potential disputes with tax authorities?

Despite the fact that regulations grant audited taxpayers a number of rights over the course of a tax audit, receiving a notice of intent to initiate an audit still gives most entrepreneurs goosebumps. Therefore, many of them are wondering how to reduce the risk of a tax audit in their company and how to safeguard themselves in the event of an audit.

For business entities with revenues exceeding €50 million, the so-called Cooperative Compliance Programme is worth looking into. This model of cooperation between the taxpayer and the National Revenue Administration assumes that the taxpayer will in fact audit their own settlement, and the tax authorities will supervise the audit mechanisms implemented by the business.

In order to limit the risk of having WHT settlement audited, it is worth applying to the Lublin Tax Office for an opinion on the application of a preference which will confirm the applicability of tax exemptions or tax preferences under tax treaties. It should be remembered, however, that obtaining such an opinion does not relieve entrepreneurs from the obligation to exercise due diligence in verifying that the conditions entitling them to claim the exemption or preferential rate are met.

To shield itself in the event of a transfer pricing audit, an entity may obtain an Advance Pricing Agreement (APA). This type of agreement, concluded between the taxpayer and the tax authority, stating that the authority accepts the choice and method of application of the price verification method applied for transactions with related entities is a tool used to reduce the risk of tax authorities questioning the transfer pricing method.

A taxpayer's obtaining of an individual ruling is also a safeguard against tax audits. The protection afforded by an individual ruling is expressed in the non-damage principle, according to which a taxpayer guided by an individual ruling issued in their case should not suffer negative consequences (such as penalties imposed on them by tax authorities). However, in order for an individual ruling to truly retain its protective power, special attention should be paid to an accurate and truthful description of the facts (or a future event) when requesting the ruling, since any irregularities and discrepancies in the description will cause the tax authorities to try to contest the ruling. 

In order to mitigate the risk of a tax or customs and fiscal audit, it is worth considering implementing own solutions to limit the occurrence of irregularities. An example of an action aimed at minimising the risk of an audit is cooperating with a company offering professional tax advisory services and launching periodic tax reviews with the purpose of verifying the correctness of the taxpayer's settlements and increasing the security of the company and its management. It is also worth considering implementing due diligence procedures in key areas of the company's tax settlements, such as VAT or WHT.