Tax Treaty Case Law around the Globe 2025

1. Introduction

The Polish Supreme Administrative Court’s decision of 27 October 2024 (case No. II FPS 1/24) addresses the interpretation of Art. 11(1) of the Poland-Sweden Income and Capital Tax Treaty (2004). The dispute arose from a discrepancy between the treaty’s Polish and English versions concerning the inclusion of the “beneficial owner” requirement for interest income. Before 2017, the Polish version omitted this clause while the English - and apparently also the Swedish - text includes it. The omission led to divergent interpretations in administrative practice and case law as to whether the treaty’s rule of exclusive taxation in the residence state applied only when the recipient of the interest was also its beneficial owner.

Article 21(1)(1) of the Corporate Persons Income Tax Act (hereinafter: CPITA) stipulates that the withholding tax rate applicable to interest paid to non-resiS. 2dents in Poland is 20% of gross income. However, this rate may be reduced pursuant to a double tax treaty. Article 21(2) of the CPITA states that withholding tax is levied in accordance with Poland’s international agreements on avoiding double taxation. Article 26(1) of the CPITA indicates that a...