In the interpretation of 21 May 2025 (signal. 0111-KDIB1-2.4010.92.2025.1.BD) The Director of National Tax Information confirmed that the family foundation, which will rent an apartment in the long term to another taxpayer, who will then rent it to third parties ‘by the day’, would be exempt from CIT.
The above means that if the family foundation has real estate and wants to make money on its short-term lease, it should first hire it to the intermediary to deal with the “rent for days”.
To date, tax authorities’ positions on the lease of short-term property have been unfavourable to family foundations, i.e. that it is an activity not permitted to result in a sanction rate of 25%.
According to the tax authorities, the rental of the property ‘by the day’ does not fall within the definition of ‘rent’ from the Civil Code to which the Family Foundation Act refers.
Director of KIS stresses that short-term rental is characterised by a lower degree of formalisation – there is often a lack of transfer-receiver protocol, cyclical fees, and media settlement issues remain outside the scope of the contract.
This position was included, inter alia, in the individual interpretation at 9 May 2025 The signature. 0111-KDIB1-2.4010.148.2025.2.MK.
Although administrative courts reject the tax authorities' argument, considering that the Family Foundation Act does not suggest a distinction between long-term and short-term rent, the judgments are not final and a possible resolution of the NSA should be pending.
A solution for family foundations that do not want to enter into a legal dispute with the tax authority may be to engage in the process of hiring an intermediary.
In the future event presented in the individual interpretation of the 21 May 2025 (signal. 0111-KDIB1-2.4010.92.2025.1.BD) the foundation intends to rent an apartment with a parking space for an unrelated capital company.
The lease agreement, as intended by the family foundation, is to be concluded for an indefinite period and the lease agreement would state that the company (the tenant) has the right to lease the premises with the parking space for short periods.
The company would be responsible for organising this short-term sub-rental and would bear the related expenses.
The family foundation is to receive a rent equivalent to 80% net revenue which the company will receive from short-term rental, after deduction of fees paid by it to booking portals.
According to the family foundation, the income will be free of CIT tax as it comes from long-term rental and the fact that short-term subletting of the premises to third parties is irrelevant.
The Director of KIS has confirmed that the activities of the family foundation presented will be within the scope of the permitted business activity and therefore the revenue from this will be exempted from CIT.
This solution, despite less profit and more complex organisational issues, can be an interesting solution for family foundations that want to avoid the risk of taxing CIT and possible legal disputes with tax authorities. Thanks to the involvement of the intermediary, the foundation does not have to deal directly with the organisation of short-term rental and at the same time can benefit from the property in a manner consistent with the applicable rules.