Penalty for Premature Contract Termination Subject to VAT, Confirms Polish Tax Authority Chief

• Penalty for early contract termination is subject to VAT.
• The penalty is considered taxable remuneration for services.
• This changes the previous stance of the National Tax Information.
• The change aligns with EU Court of Justice rulings.
• The case involved a state-owned company with commercial property leases.

Source: podatki.gazetaprawna.pl

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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