In the interpretation issued, the Ministry, explained i.a.:
This interpretation is intended to indicate the conditions which allow for the application, also by the income tax payer (e.g. the employer), of 50% of tax deductible costs in relation to revenue from the use or management of copyright by authors.
The Minister of Finance stated that in order to consider the remuneration as an author`s fee and to apply 50% of the tax deductible costs thereto, it is necessary:
In the opinion of the Minister of Finance, it is the employer and the employee who decide - within the contractual freedom of contract - how to value the work and calculate the employee's fee. What is more, the Minister directly confirmed that the share of the author's remuneration may be set e.g. on a percentage basis. He emphasised that the agreement between the parties may either explicitly indicate the amount of the fee or provide for a rule to set the fee as a percentage of the overall amount of remuneration, but that the fee must be linked to a specific work (or works of a particular type). In the general interpretation issued, the Ministry also provides for the possibility of calculating the author's fee on the basis of the time spent by the employee-author to create a work, together with the condition to provide documentation, e.g. the register of works (binding the time spent on creative activity and the creation of a specific work).
The Minister has explicitly described the formal conditions which must be met in order to apply 50% of the tax deductible costs, including the necessity to properly document the income from copyright and related rights or from the disposal of those rights and its amount. At the same time, he pointed out that the method used for archiving can, in principle, be arbitrary, e.g. it can take the form of a register. The Minister of Finance does not also exclude the possibility of documenting the creation of a work in the form of a statement if such obligations arise from an employment contract or other internal company regulations. In this case, it is crucial that the statement should indicate what type of work has been (will be) created, because a statement on the performance of the creative work alone will not be sufficient.
Moreover, the Minister of Finance, in the general interpretation issued, refers to several practical issues concerning the payment of author's fee and the possibility of applying 50% of the tax deductible costs. According to the position of the Minister of Finance:
The general interpretation issued also provides guidance on what to do if the agreed work is not created and the remitter has set advances for tax on part of the fee during the year, applying 50% of the tax deductible costs. According to the explanation of the Minister of Finance, in such a case the entity paying the remuneration is not obliged to make any adjustments to the advance payments. In the opinion of the Ministry, such an approach is dictated by circumstances related to the assumption made by the remitter at the moment of the payment of the advances that a given work will be created. Thus, at the time of payment of the advances, it must be assumed that the remitter calculated them correctly. In the opinion of the Minister of Finance, however, the necessity to make a correction may arise at the stage of making annual settlements.
The publication of this general interpretation should be viewed positively, as it clarifies a number of practical doubts related to the calculation of increased tax deductible costs. The general interpretation provides valuable guidance for the implementation of an effective copyright-based remuneration structure for employees.
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