Shares in International Personal Finance Plc fell Oct. 4 after the company said it would book up to £30 million in charges in 2017 arising from proposed changes to the corporate income tax in Poland.
The company noted that the Polish government's Council of Ministers had approved Oct. 3 a comprehensive set of proposed changes to Poland's corporate income tax. An earlier draft of the proposals indicated that International Personal Finance, or IPF, would see an increase in tax payable arising from the disallowance of tax deductions linked to certain intragroup transactions.
"For illustrative purposes, in the absence of the group taking mitigating action such as replacing the current intragroup credit hedging arrangement with a third-party equivalent, the proposals would have resulted in an increase in the group's tax charge of around £12 million to £14 million in 2016," IPF said Oct. 4.
"In addition, it would result in a one-time accounting charge in 2017 of up to £30 million arising from the write-down of a deferred tax asset."
IPF expects the changes, if approved by Polish lawmakers, to come into force at the start of 2018. The company said it will continue to push for "appropriate modification" of the proposals, adding that it has begun evaluating potential changes to its business operations to mitigate the impact of the proposed legislation.
IPF shares closed at a price of 190.25 pence Oct. 4, down from the previous day's closing price of 210.5 pence.