Tax Filing for Polish Companies in India
Poland's economic ties with India have strengthened considerably in recent years, with bilateral trade exceeding USD 4.5 billion in 2025. Polish companies including KGHM, PGNiG, Solaris Bus & Coach, Comarch, and Asseco have expanded into India across sectors such as mining equipment, IT services, clean energy, and manufacturing. India's growing consumer market, skilled workforce, and competitive cost base have made it an increasingly attractive destination for Polish enterprises seeking a presence in Asia.
Every Polish company operating in India — through a wholly-owned subsidiary, branch office, liaison office, or project office — must file an annual income tax return with India's Income Tax Department. For Polish-owned Indian subsidiaries incorporated as private limited companies, the applicable form is ITR-6, filed electronically through the Income Tax Department's e-filing portal.
India's corporate tax regime consists of multiple layers: corporate income tax (effective rate of 25.17% under Section 115BAA), advance tax payments in quarterly installments, tax deducted at source (TDS) on domestic and cross-border payments, goods and services tax (GST), and — critically for Polish-owned companies — transfer pricing documentation for all intercompany transactions with the Polish parent. Poland's own Corporate Income Tax (CIT) rate stands at 19% (with a reduced 9% rate for small taxpayers), making the interaction between the two tax systems and the India-Poland DTAA particularly important for optimizing the overall group tax position.
Beacon Filing provides comprehensive tax filing services specifically designed for Polish companies operating in India, ensuring full statutory compliance and seamless coordination with Polish tax advisors.
How Poland's DTAA Affects Tax Filing
The India-Poland Double Taxation Avoidance Agreement (DTAA), signed on June 21, 1989, in Warsaw, and amended by a protocol effective from June 1, 2014, governs the taxation of cross-border income between India and Poland. This treaty is essential for Polish companies seeking to minimize double taxation on income flowing between their Indian subsidiaries and the Polish parent.
Under the India-Poland DTAA, withholding tax rates on key categories of cross-border payments are significantly lower than India's domestic rates:
- Dividends (Article 11): Capped at 10% — substantially lower than India's domestic withholding rate, making dividend repatriation tax-efficient for Polish parent companies
- Interest (Article 12): Capped at 10% — beneficial for Polish parents that have extended intercompany loans to their Indian subsidiaries
- Royalties and Fees for Technical Services (Article 13): Capped at 15% — lower than India's domestic rate of 20%, applicable to payments for IP licensing, technical know-how, management services, and software licenses
- Permanent Establishment (PE): Polish employees or consultants working in India for extended periods could trigger PE exposure, subjecting the Polish parent's attributable profits to Indian taxation
The 2014 protocol amendment aligned the India-Poland DTAA with OECD Model Tax Convention standards and incorporated updated provisions on information exchange and anti-abuse measures. Polish companies must ensure proper treaty benefit claims by providing a valid Tax Residency Certificate (TRC) issued by the Polish tax authorities (Krajowa Administracja Skarbowa) along with Form 10F filed on India's e-filing portal. For detailed treaty analysis, see our guide on the India-Poland DTAA.
Document Requirements from Poland
Poland is a member of the Hague Apostille Convention, which means Polish documents can be authenticated via Apostille rather than the more cumbersome embassy attestation process. Apostilles in Poland are issued by regional courts (Sąd Okręgowy) for notarial documents and by the Ministry of Foreign Affairs for other public documents. For a comparison, see Apostille vs. Embassy Attestation.
Documents required for tax filing and DTAA benefit claims:
From the Polish Parent Company
- KRS (Krajowy Rejestr Sądowy) extract — the official company registration document from the National Court Register — apostilled
- Board Resolution (Uchwała Zarządu) authorizing the engagement of Indian tax filing services — notarized and apostilled
- Tax Residency Certificate issued by the Polish National Revenue Administration (Krajowa Administracja Skarbowa) for DTAA benefit claims
- Latest audited financial statements of the Polish parent (for transfer pricing benchmarking)
- Intercompany agreements covering management fees, royalties, technical services, and loans
- Power of Attorney authorizing an Indian representative — notarized and apostilled
From the Indian Subsidiary
- Certificate of Incorporation from the Registrar of Companies (RoC)
- PAN and TAN cards of the company
- GST registration certificate
- Previous year's financial statements and income tax returns
- Form 26AS (Annual Tax Statement) and AIS (Annual Information Statement)
- Details of all intercompany transactions for transfer pricing documentation
Step-by-Step Tax Filing Process
The tax filing process for a Polish-owned Indian subsidiary follows India's April-to-March financial year cycle:
Step 1: Tax Regime Selection (April)
Determine whether the Indian subsidiary should opt for the concessional tax regime under Section 115BAA (effective rate 25.17%) or continue under the old regime with available deductions and exemptions. This decision is made by filing Form 10-IC and is irrevocable once exercised. The concessional rate is competitive with Poland's standard CIT rate of 19%, and the interplay between the two rates affects the overall group effective tax rate.
Step 2: Advance Tax Payments (Quarterly)
Pay advance tax in four quarterly installments: 15% by June 15, 45% by September 15, 75% by December 15, and 100% by March 15. Interest under Section 234C applies at 1% per month for any shortfall. Polish parent companies should coordinate with their Indian subsidiary's finance team to ensure accurate tax estimates that account for intercompany transactions.
Step 3: TDS Compliance on Cross-Border Payments (Ongoing)
For every payment to the Polish parent or Polish-based vendors, deduct TDS under Section 195 at the applicable rate — either the domestic rate or the DTAA rate of 10% (dividends/interest) or 15% (royalties/FTS), whichever is lower. File Form 15CA online and obtain Form 15CB from a Chartered Accountant before each remittance. File quarterly TDS returns on Form 27Q.
Step 4: Transfer Pricing Documentation (Year-End)
Prepare contemporaneous transfer pricing documentation for all international transactions with the Polish parent, including management fees, royalties, cost-sharing arrangements, intercompany loans, and service charges. File Form 3CEB — the Chartered Accountant's report on international transactions — by the extended due date. Polish companies with IT service centers in India should pay particular attention to transfer pricing on back-office services.
Step 5: Tax Audit and Return Filing (September-November)
Complete the statutory tax audit under Section 44AB and file the audit report by September 30. File ITR-6 by October 31 (or November 30 if transfer pricing provisions apply). Reconcile advance tax paid, TDS credits on Form 26AS, and compute final tax payable or refund due.
Timeline and Costs
The complete tax filing cycle for a Polish-owned Indian subsidiary spans the entire financial year:
| Activity | Timeline | Approximate Cost (Annual) |
|---|---|---|
| Polish TRC procurement | 2-4 weeks from application | Minimal (administrative fee in Poland) |
| Advance tax installments | June 15, Sep 15, Dec 15, Mar 15 | Based on estimated tax liability |
| Quarterly TDS returns (Form 27Q) | Quarterly deadlines | INR 5,000-15,000 per quarter |
| Form 15CA/15CB per remittance | Before each cross-border payment | INR 3,000-8,000 per certificate |
| Transfer pricing documentation | By October 31/November 30 | INR 3,00,000-8,00,000 |
| Tax audit report | By September 30 | INR 1,50,000-4,00,000 |
| ITR-6 filing | By October 31/November 30 | INR 25,000-75,000 |
| ROC annual filings | Within 30/60 days of AGM | INR 15,000-30,000 |
| FEMA/FLA annual return | By July 15 | INR 10,000-20,000 |
Total annual tax compliance costs for a mid-sized Polish subsidiary in India typically range from INR 6,00,000 to INR 15,00,000, depending on transaction volumes and complexity. For more context, see our blog on Tax Compliance Costs for Foreign Subsidiaries in India.
Common Challenges for Polish Companies
1. Higher Royalty and FTS Withholding Rates
While the India-Poland DTAA provides competitive rates for dividends and interest (10%), the 15% rate on royalties and fees for technical services is higher than what some other European countries enjoy (e.g., the Netherlands at 10%). Polish companies licensing IP or charging technical service fees to their Indian subsidiaries should carefully consider the classification of payments and explore whether certain charges can be structured as business profits rather than FTS to reduce withholding tax exposure.
2. Fiscal Year Mismatch
Poland generally follows a calendar year (January-December) for corporate tax purposes, although companies can choose a different fiscal year. India mandates an April-March financial year. This mismatch creates consolidation challenges and requires the Indian subsidiary to provide financial data aligned to both calendars. Polish parent companies preparing consolidated financial statements under Polish Accounting Standards (Ustawa o Rachunkowości) or IFRS must manage this timing difference carefully.
3. Transfer Pricing on IT and Shared Services
Many Polish IT companies, including Comarch and Asseco, have established development centers in India. The transfer pricing of software development services, IT support, and shared service arrangements must demonstrate arm's-length pricing. Indian tax authorities have been particularly aggressive in challenging low-margin captive arrangements, typically expecting cost-plus markups of 12-18% for routine IT services. Maintaining robust benchmarking documentation is essential.
4. PE Risk from Employee Travel
Polish employees or directors traveling to India frequently for project management, client meetings, or technical supervision can inadvertently create a permanent establishment for the Polish parent. Under the India-Poland DTAA, a service PE can be triggered if services are provided in India for more than 90 days in any 12-month period. Companies must track employee days in India and seek professional advice if approaching the threshold.
5. New Income Tax Act 2025
India has enacted the Income-tax Act, 2025, passed by Parliament in August 2025, replacing the six-decade-old Income-tax Act, 1961, effective from April 1, 2026. Polish companies must prepare for changes in return forms, compliance timelines, and assessment procedures under the new law.
Why Choose Beacon Filing
Beacon Filing manages end-to-end corporate tax filing for Polish-owned companies operating in India. Our team coordinates between your Polish tax advisors and Indian statutory auditors to ensure seamless compliance across both jurisdictions.
We handle advance tax computation and quarterly payments, TDS compliance on all cross-border payments with DTAA-optimized withholding at 10-15%, transfer pricing documentation and Form 3CEB filing, ITR-6 preparation and filing, Form 15CA/15CB for each remittance, and FEMA/RBI compliance. Our clients range from large Polish industrial groups to mid-market IT companies with development centers in India.
Contact us for a free consultation to understand your Indian tax filing obligations and optimize your cross-border tax position. Visit our Poland country page for more on establishing operations in India from Poland.