CIT review

What does a CIT review involve?

A CIT review is a comprehensive analysis of corporate income tax-related matters which shows whether the taxpayer fulfils their obligations in due manner and if they can minimise their potential tax risk while reducing their tax burden.

Importantly, the scope of this service, provided by professional tax advisors specialising in cooperating with Polish and international companies, is in each case adjusted to the specific nature of your business and its individual requirements. This not only enables us to assess the accuracy of the tax arrangements already in place and verify individual tax-related areas, but also to proactively address the organisation’s needs and identify issues that may require further analysis.

Depending on your expectations, a CIT review may cover the entire CIT settlement process or focus only on particular areas requiring special attention, where tax advisory services are provided (in Polish or English) within a strictly defined scope. Due to its considerable flexibility, this service offered by RSM Poland can be used both as a preventative measure and for specific events requiring verification of the accounts and filings.

What can be covered by a CIT review?

The scope of the tax review is determined with each client on a case-by-case basis. It may include the following activities:

• analysis of the method of recognising taxable revenue
• verification of the correct classification of tax-deductible expenses
• assessment of accounting for fixed assets and depreciation
• analysis of the utilisation of tax losses
• verification of accounting for business funding costs 
• analysis of selected high-complexity transactions
• assessment of the possibility of applying tax reliefs and credits with recommendation of complete solutions
• verification of the alignment of tax filings with accounting records
• analysis of selected statutory obligations (the CIT Act)

Importantly, the scope of the services provided by RSM’s experts can be always extended at your request to cover additional issues relevant to your business.

What can you expect from RSM Poland’s tax advisory team?

We strive is to ensure that our cooperation runs smoothly and to provide your company with comprehensive support in assessing whether the tax arrangements in place are adequate and in implementing key changes to your company's business processes.

• Every audit starts with getting to know the nature of your business and determining the purpose of the analysis. Therefore, the first step is to agree with the taxpayer on the exact scope of work and the areas for verification.
• Next, taking into consideration the nature of your company, we get down to business and analyse selected documents, financial data, and other information regarding tax settlements. The scope of the information required for the CIT review is always adjusted to the nature of the business and to the subject of the audit.
• This is all to ensure that, at the final stage, we can report on all material risks in a comprehensible manner – briefly and concisely – as well as put forward recommendations for potential actions that could have a significant impact on the company’s finances and security.

When to carry out a CIT review?

A tax review can be a good solution both for taxpayers who wish to periodically verify their tax settlements as well as organisations ahead of important business changes.

The following situations usually merit a review:

• the possibility of the tax authorities initiating a tax audit or so-called verification activities
• following significant amendments to tax law, for example, JPK_CIT implementation
• following company restructuring or changes in the ownership structure
• before proceeding with major investments or transactions
• following the occurrence of unusual economic events
• as part of periodic evaluation of the company’s fiscal security

Regularly reviewing the CIT arrangements with regard to the above events is a very reasonable approach that allows the taxpayer for more effective management of tax risk and giving them the assurance that the solutions in place are adequate.

The most common challenges faced by taxpayers in terms of CIT

Every experienced tax advisor knows that corporate income tax issues often require assessment on a case-by-case basis. As a firm that offers comprehensive support to Polish and international taxpayers in this area, we are well aware that, in practice, business owners are mostly concerned about:

• correct classification of tax-deductible expenses 
• moment of recognition of taxable revenue 
• accounting for capital expenditure
• international transactions 
• business restructuring 
• business funding 
• using tax credits

Unfortunately, frequent changes to legislation and constantly evolving opinions of the tax authorities and administrative courts compound the difficulty of interpreting CIT regulations.

Why should your company have a CIT review?

A tax review enables you to have greater certainty as to the accuracy of your company's tax settlements and to better prepare for any changes in the tax environment.

The key benefits of a tax review include:

• strengthening of the company’s fiscal security
• verification of the accuracy of selected CIT settlements
• identification of areas requiring further tax audit
• reduction of the risk of tax mistakes
• support in decision-making concerning tax affairs
• greater certainty as to compliance with applicable regulations

What is the difference between a CIT review and CIT Compliance?

Although both services deal with corporate income tax, their scope and purpose are diverse.

CIT review is a periodic check of tax settlements. It looks at selected CIT-related areas to assess if the solutions in place are in line with applicable legislation. It can be carried out as a preventative measure or due to planned changes within the company, to prepare for a potential tax audit by the authorities, or enhance fiscal security.

CIT Compliance consists in providing ongoing support to companies in fulfilling their statutory CIT obligations. It includes, among other things, support in the calculation of tax liabilities, preparing tax returns, managing ongoing tax affairs, and giving advice on the application of relevant legislation.

In practice, the two services complement each other. Tax reviews make it possible to periodically verify the accuracy of tax settlements, while CIT Compliance provides ongoing support in proper performance of CIT-related obligations.

In providing support with CIT-related issues, RSM Poland’s tax advisors adopt a tailored approach to each company’s needs

Our team is well aware that every enterprise operates in different economic and fiscal environment, so the scope of a tax review should be always adjusted to the specific circumstances of a particular taxpayer and the nature of its business.

In providing our services in Polish and English, we adjust the scope of our analyses to your needs and expectations, concentrating on issues of greatest significance to your business. That way, you can evaluate your tax arrangements more effectively and make informed decisions regarding management of CIT-related risks. If you are looking for both an advisor and a trusted partner who can suggest the best solutions to minimise tax risks and add value to your business, feel free to get in touch. We will be happy to discuss the scope of our support and the possibilities for cooperation.

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