Precedent-setting ruling on the refund of overpayments

Today, 17 December 2025, a very important and precedent-setting judgment was issued in our client’s case concerning the refund of overpaid income tax on the sale of shares in a subsidiary.

The story began in mid-2023, when our client – a holding company – sold shares in its subsidiary. At that time, an unfavourable interpretation of the regulations was in force: the tax authorities claimed that, in order to benefit from the tax exemption, the shares had to be held for two years counted from 1 January 2022. As a result, the client concluded that it did not meet the conditions and did not submit the required declaration of intent to apply the exemption.

A few months later, the interpretation changed to one more favourable for taxpayers. When filing the annual tax return, the client realised that it had been wrongly deprived of the right to the exemption. We therefore applied for a refund of the overpayment, arguing, in particular, that a taxpayer should be protected when acting in reliance on established tax authorities’ practice. We also raised issues concerning constitutional guarantees of taxpayer rights.

The Provincial Administrative Court in Warsaw agreed with us. It overturned the tax authorities’ decisions and ruled that the client is entitled to the exemption, even if the declaration was not submitted on time. Moreover, the court found that the obligation to submit such a declaration was disproportionate and rightly removed from the regulations recently.

The judgment is not final (case ref.: III SA/Wa 2081/25), but its reasoning is very strong and may be relevant for other similar cases.

The case was handled by: Patrycja Goździowska, Tomasz Burczyński and Krystian Trzciński.