Anna Skrobek, Agata Czarna

The articles discusses the application of withholding tax to provision of data in an internet cloud. Where cloud computing allows for the processing of data in the cloud, such a service will naturally be subject to withholding tax as a data processing service. But there is no uniform interpretation of the withholding tax treatment of services which involve solely cloud-based data storage without any modification. The prevailing view among tax authorities is that such services are subject to withholding tax because they involve use of an industrial device (server). According to a more liberal approach endorsed by administrative courts, a fee for such a service should not be treated as a fee for use of an industrial device and therefore should not be subject to withholding tax.