Currently, management board members are liable for tax arrears of companies under Article 116 of the Tax Law (Journal of Laws of 2015 item 613 as amended). That is liability of a property kind, joint and several and subsidiary, for which a management board member may be held liable exclusively if enforcement from a company’s assets turns out to be totally or partially ineffective. The way to exclude such liability is to show that in the appropriate time a motion to declare bankruptcy was filed or proceedings were initiated preventing bankruptcy from being declared (arrangement proceedings), to show a management board member’s lack of culpability in not filing the above motions, or indicating possessions making enforcement possible to a considerable extent. In accordance with the established opinion of courts, when deciding on the liability in question a tax authority only needs to show that a given person carried out the obligations of a management board member at the time when the tax arrears arose, and that enforcement from assets was ineffective, while demonstrating the existence of any excluding (exonerating) conditions rests with the management board member (cf. rulings of the Supreme Administrative Court of 6 March 2003, case file no. SA/Bd 85/03, and of 25 June 2014, case file no. II FSK 1735/12).
As of January 2016, similar rules of liability will apply to liquidators of companies other than those appointed by the court. Doubts will therefore be removed as to who is liable for tax arrears of a company which arise during liquidation. In addition, this regulation (other than Article 116 of the Tax Law) has not been restricted exclusively to companies.
The regulation concerning filing on time will also change. Since arrangement proceedings will become part of more extensive restructuring proceedings, management board members and liquidators will not be liable for a company’s liabilities if they show that a motion to declare bankruptcy was filed at the appropriate time or that in that time restructuring proceedings were opened, or that an arrangement has been approved in arrangement approval proceedings.
The most important tax changes will be taken directly from bankruptcy law regulations, which significantly extends the time for filing a motion to declare bankruptcy. Currently, on account of Article 21 of the Bankruptcy and Reorganisation Law (Journal of Laws of 2015, item 233 as amended), the appropriate period is two weeks from the day on which the basis for declaring bankruptcy appeared. In practice, this is the day on which a company ceases to carry out its pecuniary obligations due, or the day on which the company’s liabilities exceed the value of its assets. As of January, a motion must be filed within 30 days of the day of loss of capability to perform those obligations, with the reservation of the introduction of statutory presumptions as to when such a situation can occur. Taking into account the content of the amended Article 11 of the Bankruptcy Law, a motion should be filed within 30 days of the day on which a three-month delay elapses in performing pecuniary obligations, or the day on which 24 months of a continued state elapses in which a company’s pecuniary liabilities exceed the value of its assets.
Since the liability in question also does not arise if in that time restructuring proceedings are opened or an arrangement is approved in arrangement approval proceedings, it must be acknowledged that the Tax Law in each case refers to time periods from bankruptcy law (in restructuring law such time periods have not been provided anyway).
Thus, after the amendments are introduced, liability will not only apply to management board members but also to liquidators of companies, and those persons should carefully analyse the condition of being potentially liable, with one’s own assets, for tax arrears of the companies managed.