The Minister of Finance confirmed in his general interpretation that there is no revenue for the contributing party in connection with the cash contribution to the company | TAX Alert

On the basis of amended provisions of CIT law, which entered into force on 1st January 2018, some doubts have arisen on whether making cash contributions to the company (which is a corporate income tax payer, e.g. within the increase of share capital of the limited liability company [“spółka z ograniczoną odpowiedzialnością”] or joint-stock company [spółka akcyjna]) will result in a revenue for the entity making such contributions.

It was a result of an amendment of article 12 (1) item 7 of the CIT Act. This provision has regulated the issue of obtaining revenue in relation to making an in-kind contribution to the company. Its literal wording after the amendment indicated that making cash contributions to the company shall be a subject to the taxation too.

In the general interpretation published on 2nd March 2018, the Minister of Finance admitted that the new wording of the CIT Act article 12 (1) item 7 may rise some concerns, the provision does not, however, cover within its scope the cases of cash contribution to the company. Thus, making a cash contribution does not give rise to the revenue for the entity making such contribution.

Notwithstanding the explanations brought by the Minister of Finance, the Parliament [Sejm] is working on the Act amending changes implemented on 1st January 2018. The amendment must clearly show that only in-kind contributions shall be taxed. This regulation shall effect retroactively, i.e. it will apply to  income earned from the beginning of the current year.


If you have any questions concerning the effect of the said regulations on your business activity, feel free to contact us.

Tomasz Wickel – Partner, Attorney at Law
Beata Krokos – Associate, Attorney at Law

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