Work on the Polish family foundation was resumed, which is intended to change the shape of succession solutions, introducing more flexible rules, including regarding tax neutrality of contributions to the foundation, as well as zero income tax from the Foundation's passive incomes.
After consultation, which began last autumn, over the coming 2-3 weeks, the Ministry of Development is expected to report on the government's work list a draft new legislation on the family foundation, together with a prepared impact assessment. The family foundation is to be one of the tools of succession for the MPW.
Following the legislative process, it can be noted that this initiative is linked to the so-called holding law prepared by the Ministry of State Acts, which introduces into the Commercial Companies Code regulations relating to the relationship between “groups of companies”.
The family foundation will be able to become the owner of the company, shares in companies, securities, as well as real estate and movable property. The income generated by the family foundation’s assets can be used for family needs. This will bring together two important spheres: business and private life.
It can be noted that foundations will in many cases be able to become a holding company that will be subject to the established holding law, including new rules on minority shareholders, novelties on binding orders or on the protection of creditors. More on changes in the Commercial Companies Code in terms of so-called holding rights.
As we read in the Green Paper on the foundation of family holding solutions are already being used, but Polish law does not facilitate them, and the construction of complex structures and networks of connections requires significant costs of maintaining them. To change this, i.e.
to facilitate the succession process conducted under a family foundation, could facilitate taxation that corresponds to inheritance, that is to say, they would maintain such tax neutrality as in the immediate family circle, for example, exemption from CIT of tax income (at least passive income) or exemption from PIT of income of downstream beneficiaries.
The Devil is in the details, so we will look at the developments. New regulations are to enter early in the year 2022.