In Poland, dispute over cash gifts remains stalled at Constitutional Tribunal — Interia

In Poland, the Constitutional Tribunal has still not issued a ruling in a dispute over a tax exemption for cash gifts from immediate family members. It concerns situations in which money is handed over in cash and the recipient later deposits it into their own bank account. Interia reports.

Conditions for tax exemption

In Poland, gifts between immediate family members may be exempt from tax. If the value of property received from one person does not exceed 36,120 zlotys, there are no tax liabilities. All receipts from the same donor over the past five years are taken into account when calculating this limit.

For a full tax exemption for an amount exceeding this threshold, the recipient must notify the tax authority within six months using form SD-Z2. For monetary gifts, confirmation of a bank transfer, crediting of funds to an account, or a postal transfer is also required.

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Position of tax authorities and the court

Tax authorities do not consider the cash transfer of funds “from hand to hand” sufficient grounds for an exemption if the recipient later deposits the money into an account themselves. Such a banking transaction shows that cash was deposited, but it is not always possible to establish unequivocally who exactly transferred these funds.

Poland’s Supreme Administrative Court, in a resolution by seven judges in case III FPS 3/22, supported this approach. At the same time, the court noted that if the origin of the money can be proven, depositing the funds into an account alone may be sufficient to document the gift.

Question referred to the Tribunal

The Supreme Administrative Court referred a legal question to the Constitutional Tribunal. It must assess whether provisions that make a tax exemption dependent on meeting such formal requirements comply with the Constitution. The review concerns the principles of family protection, equality before the law, and citizens’ trust in the state.