Fiscal criminal defence (KKS) – strategy for board

A Warsaw-based technology company receives a notification from the National Revenue Administration (Krajowa Administracja Skarbowa, KAS) that a fiscal criminal investigation has been opened. The board members are named as suspects. The company's accountant has already been questioned. No one on the board knows what to say, what to produce, or what rights they actually hold at this stage.

Under Polish fiscal criminal law, governed by the Kodeks karny skarbowy (Fiscal Penal Code, KKS), board members face personal liability for tax offences committed in connection with the company's activity. Penalties range from a daily-rate fine to custodial sentences of up to five years for the most serious fiscal crimes. A suspect who takes no active defensive steps within the first weeks of an investigation forfeits procedural rights that cannot be recovered later.

This guide walks through the KKS procedure step by step: how investigations are opened, what rights suspects hold at each stage, where the critical decision points lie, and how a defence strategy should be built. Three business scenarios illustrate how the same legal framework operates differently depending on company type, transaction size, and the board's prior conduct.

How does a KKS investigation against board members begin?

The KKS investigation is typically opened by the KAS, the Tax Office (Urząd Skarbowy), or the Customs and Fiscal Service (Służba Celno-Skarbowa). Each body has authority to conduct preparatory proceedings. The investigation begins when a formal decision designates a person as a suspect – a moment that triggers a 30-day window within which the suspect must be informed of the charges.

In practice, board members often learn about their suspect status through a summons to a first interview rather than through formal written notification. That interview is not routine. Every statement made at that point forms part of the evidentiary record. Arriving without counsel is one of the most common and most damaging mistakes in KKS proceedings.

Three entry points are most common in corporate cases:

A VAT audit that escalates into a criminal referral after the auditor identifies irregularities exceeding PLN 500,000
A JPK_VAT cross-check that flags discrepancies across multiple tax periods
A whistleblower report filed with the KAS by a former employee or business partner

The National Court Register (Krajowy Rejestr Sądowy, KRS) is used by investigators to confirm who held board positions during the periods under scrutiny. Entries in the KRS are treated as conclusive evidence of managerial authority. A board member who resigned before the relevant transactions but remained registered is still at risk. Registration gaps create personal exposure that a well-timed defence can address – but only if raised promptly.

We secured a reversal of a fiscal criminal charge against a board member of a manufacturing client in the Mazowieckie region (autumn 2025). The key was demonstrating, using KRS data and internal governance documents, that the suspect had no operational authority over the tax function during the period in question.

What procedural rights does a board member suspect hold?

The KKS grants suspects a defined set of procedural rights from the moment of formal designation. The right to refuse to testify is absolute. The right to legal counsel attaches immediately. The right to inspect the case file – subject to the prosecutor's discretion during preparatory proceedings – can be exercised within ten days of a request. These rights are real, but they expire or narrow as the procedure advances.

Board members frequently underestimate the significance of the voluntary disclosure mechanism under the KKS, known as czynny żal (active remorse). A timely voluntary disclosure, filed before the authority has documented the offence, eliminates criminal liability entirely. The disclosure must be specific: it must identify the offence, the tax period, and the amount of the shortfall. A general statement of regret has no legal effect. The deadline is strict – once the KAS has formally recorded the irregularity, the window closes permanently.

Key rights to exercise immediately:

Appoint defence counsel before the first interview
Request a copy of the notification of charges in writing
Assess whether czynny żal remains available – ideally within 48 hours of learning of the investigation
Obtain a full KRS printout covering the relevant periods

The Polish Financial Supervision Authority (Komisja Nadzoru Finansowego, KNF) may also refer matters to the KAS where fiscal irregularities intersect with capital market activity. In those cases, the procedural timeline compresses significantly, because KNF referrals typically accompany a parallel administrative investigation. Board members in regulated sectors face a dual-track exposure that requires coordinated defence across both proceedings.

For companies with cross-border structures, the interaction between KKS proceedings and insolvency risk deserves separate analysis. Our guide on cross-border insolvency involving Poland and France explains how French holding structures affect board liability in Polish fiscal proceedings.

What are the most dangerous mistakes in KKS defence strategy?

The single most damaging error is treating the KKS investigation as an administrative dispute. It is not. Once criminal proceedings begin, the rules of evidence, the burden of proof, and the consequences of procedural missteps shift entirely. A board member who responds to a criminal summons as if answering a tax audit query will produce a record that prosecutors can use for years.

The second critical error is failing to separate the company's defence from the individual board member's defence. These are legally distinct positions. The company may choose to cooperate, correct its tax returns, and settle a surcharge. The board member may simultaneously have grounds to contest personal criminal liability. Conflating the two strategies – or allowing the company's tax counsel to represent the board member in criminal proceedings – forfeits the individual defence.

A third mistake involves asset transfers after the investigation opens. Any disposal of personal assets following formal designation as a suspect may be treated as an attempt to frustrate enforcement. The KKS permits asset freezes (zabezpieczenie majątkowe) covering personal property of board members. A freeze order can be issued within days of the investigation opening, and it covers amounts up to the anticipated fiscal penalty – which in serious cases can exceed PLN 1,000,000.

We obtained a pre-emptive lifting of a provisional asset freeze for a board member of a retail group in Lower Silesia (spring 2026), by demonstrating to the district court that the factual basis for the freeze order had been assessed incorrectly by the investigating authority.

(It is worth adding that asset freeze challenges are time-sensitive. The window to contest a freeze order is seven days from service. Missing that deadline does not permanently close the route, but it significantly raises the procedural burden for subsequent challenges.)

How should the defence strategy differ across business scenarios?

The KKS framework is uniform, but its practical application varies sharply depending on the company's structure, the nature of the alleged offence, and the board member's specific role. Three scenarios illustrate the key divergences.

Manufacturing company with a multi-year VAT dispute. The board has changed composition twice during the period under review. The investigation covers alleged input VAT overclaiming across 18 months. Here, the defence priority is establishing a precise timeline of board authority – who signed which returns, who had access to which supplier documentation, and what internal approval processes existed. The KRS record is the starting point, but internal resolutions, power-of-attorney registers, and accounting system access logs are equally important. A partial voluntary correction of VAT positions for periods not yet formally under investigation can eliminate liability for those periods entirely.

IT company with transfer pricing exposure. The KAS has reclassified intercompany service fees as a hidden profit distribution, triggering a CIT shortfall of PLN 800,000. Board members are named because they approved the intercompany agreements. The defence strategy here focuses on the arm's-length documentation and the board's reliance on professional transfer pricing advice. Under the KKS, reliance on professional counsel is a recognised mitigating factor – but only if the advice was obtained before the transaction, was specific to the structure, and was followed consistently.

Foreign investor subsidiary. A German parent company's Polish subsidiary is under investigation for alleged customs duty evasion. The local board consists of two Polish managers and one German national. The German board member's exposure under the KKS is identical to that of the Polish members – Polish fiscal criminal law applies to all persons exercising managerial functions in Poland, regardless of citizenship. Coordination with German counsel is necessary, but Polish KKS procedure governs the substance and timeline of the defence. Structures involving family foundations and asset-holding vehicles require separate analysis; our article on the family foundation in Poland covers the relevant tax and liability considerations.

Across all three scenarios, the defence timeline is front-loaded. The first 30 days after formal designation as a suspect are the most consequential. Decisions taken – or not taken – in that window shape the entire subsequent proceeding.

Specific situations require tailored analysis. If your company is facing a KKS investigation or a KAS audit that may escalate, contact info@kordeckipartners.com for an expert assessment before the first procedural deadline passes.

What does the KKS procedure look like from charge to resolution?

The KKS procedure follows a defined sequence. Preparatory proceedings (postępowanie przygotowawcze) are conducted by the KAS or the prosecutor and typically last between six months and two years for complex corporate cases. At the close of preparatory proceedings, the authority either files an indictment with the district court (sąd rejonowy) or discontinues the proceedings.

A pre-pack arrangement in a parallel restructuring proceeding can affect the KKS timeline. Where the company enters an approved restructuring plan under Polish restructuring law (Prawo restrukturyzacyjne), the board's cooperation with the restructuring court and the creditor committee can be presented as evidence of good faith in the criminal proceedings. This interaction between restructuring and fiscal criminal defence is one of the more technically demanding areas of Polish law. Our analysis of cross-border insolvency involving Poland and Spain illustrates how these parallel tracks operate in practice for companies with Iberian ownership structures.

At the trial stage, the district court examines the evidence assembled during preparatory proceedings. The board member defendant has the right to present witnesses, commission expert opinions, and challenge the KAS's calculation methodology. Challenging the calculation is frequently decisive: if the alleged fiscal shortfall falls below the statutory threshold for a fiscal crime (currently eight times the minimum monthly wage, approximately PLN 35,000), the conduct is reclassified as a fiscal offence (wykroczenie skarbowe) subject only to a fine.

What to prepare before the first KAS interview:

Current KRS printout confirming board composition during the relevant periods
Internal resolutions delegating tax-function responsibility
Copies of all tax returns filed during the period under investigation
Any written professional tax advice received before the transactions in question
Documented timeline of any voluntary corrections already submitted

Resolution paths include: discontinuation of proceedings, conditional discontinuation (with payment of a penalty), conviction with a suspended sentence, or – in the most serious cases – an unsuspended custodial sentence. The probability of each outcome depends heavily on whether the board member took active steps in the first 90 days of the investigation. Passive defence rarely produces the best result.

Your company's specific exposure depends on facts that a general guide cannot capture. If board members face a KKS investigation – or anticipate one – we will assess the procedural position, identify available defences, and coordinate the response across tax and criminal proceedings: contact info@kordeckipartners.com.

Frequently asked questions

Q: Can a board member who has already resigned be prosecuted under the KKS?

A: Yes. Fiscal criminal liability under Polish law attaches to the person who held the managerial function at the time the offence was committed, not at the time the investigation opens. A resignation after the relevant tax periods does not eliminate exposure. The National Court Register entry for the relevant period is treated as conclusive evidence of the position held. Former board members should seek counsel as soon as they learn of any investigation, even if their name does not yet appear in the formal proceedings.

Q: How long does a KKS investigation typically take, and what are the costs of defence?

A: Preparatory proceedings in complex VAT or CIT cases typically last 12 to 24 months before an indictment or discontinuation decision. Simpler cases involving a single tax period may resolve within six months. Defence costs depend on complexity: a straightforward voluntary disclosure procedure may require 10 to 20 hours of counsel time, while a full trial defence in a multi-period corporate case commonly involves 100 or more hours. Engaging counsel early – before the first interview – consistently reduces total costs by narrowing the scope of the proceedings.

Q: Is it true that paying the outstanding tax eliminates KKS liability automatically?

A: This is a common misconception. Payment of the outstanding tax is a significant mitigating factor and, in some cases, a precondition for voluntary disclosure to be effective. However, payment alone does not extinguish criminal liability. The KKS requires either a valid czynny żal filed before the authority has documented the offence, or a formal discontinuation or acquittal decision. A board member who pays the tax but does not file a proper voluntary disclosure remains a suspect. Coordinating the payment with the procedural steps is essential.

KORDECKI & Partners is a law firm based in Warsaw and Krakow, advising business clients across 30 jurisdictions. Our team combines expertise in Polish and international law with a practical approach to fiscal criminal defence, restructuring, and white-collar matters. We work with Polish entrepreneurs, foreign investors, and in-house legal teams. To discuss your situation, contact info@kordeckipartners.com.