Poland: From July it is easier to avoid inheritance and gift tax

On July 1, the largest increases in tax-free inheritance and gift taxes in many years came into force. This will mean that a larger group of beneficiaries and heirs will not be obliged to pay this tax Law.pl. Preferences will cover primarily purchases from close and extended family. The closest family will still be exempt from tax if they report the purchase to the office and receive the money by bank transfer.

Amendments to the Inheritance and Donation Tax Act are introduced by the SLIM VAT 3 package, i.e. an amendment to the VAT Act and some other acts (Journal of Laws of 2023, item 1059).

As he informs Law.plthe acquisition of: from one vendor, the ownership of things and property rights with a pure value exceeding:

– PLN 36,120 – for buyers included in the first tax group (previously PLN 10,434),

– PLN 27,090 – for buyers included in the second group (previously PLN 7,878),

– PLN 5,733 – for buyers included in the third group (previously PLN 5,308).

Belonging to particular groups depends on the degree of kinship:

– group I: spouse, descendants (children, grandchildren), ascendants (parents, grandparents), stepson, son-in-law, daughter-in-law, siblings, stepfather, stepmother and in-laws.

– group II – descendants of siblings (e.g. sister’s children), siblings of parents, descendants and spouses of stepchildren, spouses of siblings and siblings of spouses, spouses of spouses’ siblings, spouses of other descendants,

– to group III – other buyers.

“The increase in the tax-free allowance is, of course, a positive change, thanks to which it will be easier to avoid inheritance and gift tax. People who acquire inheritances and donations from close and distant family members will benefit in particular. If the value of the donation is within the tax allowance, the purchaser will not pay any tax and will not have to report the purchase to the tax office,” explains Grzegorz Grochowina, head of the knowledge management team at the tax department at KPMG in Poland, quoted by Law.pl.

The service adds that the Ministry of Finance points out that these amounts are much higher in the circle of close and extended family, and only slightly higher in the case of strangers belonging to the third tax group. According to Law.pl The Ministry justifies this by saying that the reason is the risk of tax abuse and tax avoidance, both in the case of inheritance and donation tax, as well as PIT. The point is to avoid, for example, referring to fictitious donations.

Full text of the article: https://www.prawo.pl/podatki/od-lipca-wiecej-darowizn-i-spadkow-bez-podatku,521989.html

Information source: PAP MediaRoom