Tax residency vs bank accounts and emi

[Puzel12]

I was talking with multiple tax advisors in Poland, and they all mentioned that even bank accounts can decide about my tax residency, as these are serious connections with the country.
So my question is: If I am self-employed in the Czech Republic but 100% of my clients are from Poland and I receive payments in PLN (Polish currency) on fintech / EMI ( Revolut and ZEN). Can it be reason to try to assign me to polish tax residency? FYI. I also have bank accounts in other jurisdictions, and I am shareholder of company in Poland (not employed), I do sole proprietorship in Czech Republic and I own US LLC that deals with international clients. So my total income is 50% Poland and 50% USA/WEST EU.

I think it's not a reason to be polish tax resident because:
1. Revolut and Zen aren't polish banks. They just give access to polish bank account with polish IBAN. Zen.com have electronic money license of Lithuania, and Revolut bank license in the UK. Btw. Both have head offices in Poland.
2. Currency and client's location don't decide about someone's tax residency. (I am doing online business - paid ads management more specifically)

Btw. In Poland maybe I am 30 days per year or something like that. I live in Thailand. Main reason why I keep my self-employed structure in Czech Republic is that I need to receive Polish currency from my clients.


Please tell me if I am right/wrong.

 

[Gediminas]

Puzel12 said:
So my question is: If I am self-employed in the Czech Republic but 100% of my clients are from Poland and I receive payments in PLN (Polish currency) on fintech / EMI ( Revolut and ZEN). Can it be reason to try to assign me to polish tax residency?
Click to expand...

No, this can not be a reason to determine your tax residency country. Your passport can. But usually, financial institutions follow the utility bill etc.

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[burden]

Agree, that's not how it works, they will look at where you come from, the information they get from the utility bill.

 

[Martin Everson]

Puzel12 said:
I was talking with multiple tax advisors in Poland, and they all mentioned that even bank accounts can decide about my tax residency, as these are serious connections with the country.
So my question is: If I am self-employed in the Czech Republic but 100% of my clients are from Poland and I receive payments in PLN (Polish currency) on fintech / EMI ( Revolut and ZEN). Can it be reason to try to assign me to polish tax residency?
Click to expand...

No

Puzel12 said:
Btw. In Poland maybe I am 30 days per year or something like that. I live in Thailand. Main reason why I keep my self-employed structure in Czech Republic is that I need to receive Polish currency from my clients.
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Oh ok now it sounds like your tax advisor could be correct. I don't know Poland's thresholds but spending time in that country while deriving income from that country is logical for them to tax your income on a non-resident basis on Polish source income.

Are you Polish btw?

Puzel12 said:
Please tell me if I am right/wrong.
Click to expand...

Listen to your tax advisor in this situation. As several connection to Poland combined can make you tax liable in Poland i.e clients all in Poland, bank account in Poland, property in Poland, kids in school, and regular presence in Poland etc etc. This actually happens in other countries as well where they can still deem your centre of activity to be the country you left as they can deem you to still maintain substantial economic ties.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[Puzel12]

Martin Everson said:
Oh ok now it sounds like your tax advisor could be correct. I don't know Poland's thresholds but spending time in that country while deriving income from that country is logical for them to tax your income on a non-resident basis on Polish source income.

Are you Polish btw?
Click to expand...

Yes, I am Polish. Really? Even if I spend there only 30 days? Most of my time I am spending in Thailand and have wife here, and I rent home here.
I don't have anything in Poland beside 2 accounts I mentioned. Are they considered banks for tax residency purposes? and polish clients with who I work online.

In Poland similar to other EU countires you need to spend 183+ days and have interest / life center here to be tax resident.

Martin Everson said:
Listen to your tax advisor in this situation. As several connection to Poland combined can make you tax liable in Poland i.e clients all in Poland, bank account in Poland, property in Poland, kids in school, and regular presence in Poland etc etc. This actually happens in other countries as well where they can still deem your centre of activity to be the country you left as they can deem you to still maintain substantial economic ties.
Click to expand...

But can it be substantial economic ties if I am working with my Polish clients from Thailand?

 

[Martin Everson]

Puzel12 said:
I don't have anything in Poland beside 2 accounts I mentioned. Are they considered banks for tax residency purposes? and polish clients with who I work online.
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No not a bank by itself. But a bank with maybe direct debits to pay heating, council taxes, local expenses etc. You don't have any personal accounts or any other financial commitments in Poland?

Puzel12 said:
Yes, I am Polish. Really? Even if I spend there only 30 days?
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What are you doing in those 30 days, They can argue its business. With taxman burden of proof is always on you. So make sure obvious things like ticket was not paid by company etc.

Puzel12 said:
In Poland similar to other EU countires you need to spend 183+ days and have interest / life center here to be tax resident.
Click to expand...

No the 183 day is not true at all. For example in UK (even after leaving) if you own or have access to a property that you spend 30 days or more in it and have no home abroad in a year you are automatically tax resident in UK again 😕. Not a specific EU example but you get my point. Other EU states may have crazy rules similar to this.....maybe even Poland.

Puzel12 said:
But can it be substantial economic ties if I am working with my Polish clients from Thailand?
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No but one needs to look at whole picture of your lifestyle. You would have explained this to your tax advisor and they will have determined the risks of still being caught in the tax net.

But if your life is centered in Thailand and you are without property, kids and client visits etc in Poland you should be ok in reality. There would have to be a very good reason for the taxman to want to care about you.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.