On 4 August 2026, preliminary remarks to the bill amending the CIT Act and PIT Act were added to the list of legislative work and policies of the Council of Ministers (Bill amending the Personal Income Tax Act and the Corporate Income Tax Act – Chancellery of the Prime Minister – Gov.pl portal).
The bill introduces a raft of amendments to the Family Foundation Act.
It is expected to be passed by the Council of Ministers in Q3 2026.
Purpose and background
The proposed amendments in the area of taxation of family foundations are a response to needs identified during the review of the Family Foundation Act to further tighten the Polish tax system. The Ministry of Finance has indicated that a review of market practice has revealed instances of family foundations being used in ways that run counter to their intended purpose.
Tightening rules on taxation of family foundations
The bill provides for the introduction of a package of anti‑avoidance measures, including in particular:
- making the application of the preferential tax regime conditional on retaining ownership of assets for a specified period (36 months);
- eliminating the possibility of avoiding taxation by a family foundation through conducting activities via tax-transparent entities;
- bringing family foundations within the scope of the controlled foreign company (CFC) regime;
- clarifying the rules for taxing income earned by a family foundation under agreements pursuant to which real estate is made available for consideration (e.g., through short‑term lettings);
- increasing the tax rate applicable to income treated as “hidden profits”, as referred to in Article 24q of the CIT Act, from 15% to 19%.
These measures are intended to ensure that the practical operation of family foundations is aligned with the original legislative purpose behind their introduction into the legal system and to limit practices that amount to circumventing tax rules and using this vehicle in a way that departs from the legislature’s original intentions.
It should, however, be noted that the bill largely reiterates the proposals contained in the Act amending the Corporate Income Tax Act, which was vetoed by the President on 27 November 2025.
Extension of tax exemptions for founder’s family
In parallel, the bill provides for measures designed to better support the fundamental purpose of a family foundation, namely, to ensure intergenerational succession and preserve accumulated family wealth.
At present, PIT exemption does not cover benefits received from a family foundation by beneficiaries or persons entitled to receive assets on the dissolution of a family foundation who are descendants of siblings acting as founders. These descendants are currently required to pay PIT at a rate of 10% on their revenue.
The bill provides for extending the PIT exemption to benefits received by descendants of siblings who are founders of a family foundation – both beneficiaries and persons entitled to receive assets in connection with the dissolution of the family foundation. For the purposes of determining the proportion relevant to the tax exemption, rules analogous to those applicable where the foundation has been established by the siblings’ parents will apply, namely, full PIT exemption for all descendants of each sibling.
How can we assist you?
KPMG’s team is continuously monitoring the legislative process and actively participating in public consultations, to provide you with the most up‑to‑date information and practical recommendations. We remain at your disposal and would be pleased to answer any questions and provide further clarification regarding the proposed changes.