Back to the insights archive
Legal updates

Company in decline – possibilities under the draft Act on the Management Board of a Successive Business of a Natural Person

The government adopted a draft law on the management of a successiond enterprise of a natural person.

The government adopted a draft law on the management of a successiond enterprise of a natural person.

The Act is intended to allow the company to continue operating smoothly after the death of the company's owner.

According to CEIDG data on the state of the small and medium-sized enterprises sector in Poland, one-person business activity is...

The government adopted a draft law on the management of a successiond enterprise of a natural person. The Act is intended to allow the company to continue operating smoothly after the death of the company's owner.

According to CEIDG data on the state of the small and medium-sized enterprises sector in Poland, single-person economic activity is the most popular form of economic activity. This form of business is more than 80% all companies in Poland.

Currently, in the event of the death of the owner, the company ceases to exist formally, which can make the situation considerably more complicated, for example, by its employees or contractors.

The legislator decided to regulate the question of the continuation of business activity by the heirs of the entrepreneur. This action has been positively assessed by both entrepreneurs and the legal community.

The adopted draft envisages a change in total 25 legal acts, including tax laws. The legislator proposes a rather unusual solution. It is intended to consist of tax exemption from inheritance tax and donations, among other things, of receiving inheritance tax.

Such a change seems deliberate, given the justification for the bill, and it would be no wonder if the legislator had not gone a step further. In addition, the project proposes a tax exemption for the inheritance of the company (including non-donor-related family ties).

This means that, once certain conditions are fulfilled, the tax exemption will benefit not only from the inheritance of the company itself, but also from receiving it in a gift from the heir, regardless of the family relationship of the donor and the recipient. Such an incentive for the legislator to operate after the death of the entrepreneur will allow, among other things, the tax-neutral transfer of the inherited part of the company to a personal commercial law company and then further measures to optimise the use of the assets received.

Draft Act on the Management of a Successive Business of a Natural Person 27 February 2018 addressed to the first reading at the session of the Sejm.

Continue exploring our insights.

View the full archive
Legal updates

Obligations of traders to provide non-cash payments

As part of the amendment package under the noisy name Polish Deal, which most of the solutions entered into force at the beginning of January 2022, to stimulate a new impetus for the gradually growing trend in the market for non-cash payments, and at the same time to counter and combat the gray...

Legal updates

Deduction – what is involved and when possible

Deduction is a legal institution regulated in Article 498-505 KC.

Legal updates

Business secrecy in the context of changes to the Public Finance Act - comment

From 1 July 2022 information on all contracts exceeding the value 500 PLN, which from the beginning of this year have been concluded by public authorities (including JST), will be public and will be entered in the register kept by the Minister of Finance.