Inheritance Tax in Poland
Taxpayers of inheritance tax are only individuals; in case of legal persons CIT is levied. Inheritance tax is imposed on acquisition by inheritance of property (movable and immovable) located in Poland and property rights exercised in Poland, including money. Also acquisition of property located outside Poland and rights exercised abroad is taxable if at the moment of death of the decedent, the beneficiary was a Polish national or had a permanent place of residence in Poland. Acquisition of movables located in Poland and property rights exercised in Poland is excluded from taxation if a the moment of death neither the decedent nor the beneficiary were Polish nationals or had permanent residence in Poland.
Taxable base is market value of acquired property or property rights, reduced by the value of debts and other burdens. Rates are differentiated (from 3 % to 20 %) according to categories of family proximity between the beneficiary and decedent as well as the value of acquired property. Tax-free amounts are also set depending on proximity. Lowest rates and highest tax-free amounts are reserved for taxpayers belonging to so called “first tax group”, including spouses, descendants, ascendants, siblings, stepchildren, stepparents, children-in-law and parents-in-law. For instance tax on a 20000 PLN worth property inherited from parents amounts to 208.30 PLN plus 5 % of excess above 10278 PLN.
Acquisition by members of the first tax group is exempt from tax if reported to tax office within a month since coming into force of a court judgment confirming acquisition of heritage. Other exemptions encompass acquisition of a farm, an immovable property registered as a relic, house furnishings. A relief is granted in case of acquisition of a dwelling building or a part thereof, by excluding from the taxable base the value of upmost 110 m2 of utility area.
Taxpayers submit an informative tax return within a month since the tax moment (generally acceptance of the heritage). Tax liability arises upon issuance and service of an assessment decision.
Malgorzata Sek
Foundation Centre of Tax Documentation and Studies in Lodz
