Polish tax authorities now allow businesses to deduct earn-out expenses when they are incurred, not when shares are sold.
Different Opinion from National Tax Information Service
The director of Poland’s National Tax Information Service previously held a different view. They ruled that compensation resulting from earn-out clauses could only be considered a business expense at the time of disposing purchased shares.
Previous Interpretations Revoked
The head of the National Revenue Administration (KAS) has revoked earlier interpretations from July 31, 2025 (sign. 0111-KDIB1-2.4010.279.2025.1.BD) and December 14, 2021 (0111-KDIB1-1.4010.329.2021.1.MF) that held this position.
Earn-out Clause
An earn-out clause is a contractual provision in M&A transactions where part of the purchase price is contingent on the acquired company meeting certain performance targets after the transaction closes.