Major Changes in Tax Scheme Reporting (MDR)

On 19 June 2026, the president signed an amendment to the Tax Code, with most measures taking effect as early as 1 October 2026. The changes mainly ease existing regulations and are generally advantageous for taxpayers. Below, we present the key changes to tax scheme reporting (MDR).

The Amendment:

1. Eliminates the requirement to report domestic tax schemes

2. Drops the obligation to report VAT and excise duty schemes

3. Fully removes the duty to report tax schemes based on other specific hallmarks

4. Modifies the catalogue of generic hallmarks

5. Eliminates the obligation to maintain an internal MDR procedure

6. Permits authorised representatives to sign MDR-3 information

7. Removes the category of “supporting entities”

What are the Practical Implications?

The amendment significantly limits tax scheme reporting obligations; however, it does not abolish them altogether.

One change that may have a significant practical impact is the narrowing of the scope of the so-called generic hallmark referred to in Article 86a(1)(6)(f) of the Tax Code. The provision no longer refers to “changes in taxation rules resulting in effectively lower taxation, exemption, or exclusion from taxation”.

Previously, the broad wording of this provision meant that it covered many routine legal transactions whose side effect was lower taxation. After the amendment, it will apply only to arrangements involving the reclassification of the source of income (revenue).

It should also be noted that the lawmakers have not removed or even limited the severe penalties for failure to comply with reporting obligations. Failure to report a tax scheme will still be punishable by a fine of up to PLN 46 million.

MDR Procedures after 1 October 2026 – Retain, Modify, or Remove?

From 1 October 2026, taxpayers will no longer be required to have an internal MDR procedure. This means that companies which have implemented such procedures should decide whether to remove or update them. Keeping the procedure in its current form may lead to irregularities in fulfilling MDR obligations and expose management board members to severe financial penalties.

That being said, eliminating the procedure altogether may not be the wisest approach from a risk-management perspective. A well-adapted MDR procedure can still facilitate compliance with reporting obligations, bring order to internal processes, and serve as a robust defence in the event of an audit, demonstrating that due diligence was exercised.

For more information, contact our Tax team.