Major Tax Ruling in Poland

The Polish Constitutional Tribunal has declared the ban on depreciating fixed assets acquired through donations unconstitutional.

Under the previous regulations, taxpayers who obtained assets as gifts were prohibited from claiming depreciation deductions, even if the assets were actively used in their business activities. This restriction created disparities in tax treatment compared to those who acquired assets through purchase.

The Tribunal’s decision highlighted that this prohibition violated two key constitutional principles:

1. Equality before the law – the inability to depreciate donated assets placed taxpayers in unequal positions based on how they acquired their property.
2. Protection of property rights – the restriction prevented taxpayers from fully utilizing their assets, limiting their economic value.

This ruling is expected to have a significant impact on taxpayers, offering new opportunities to claim depreciation deductions for gifted assets. It also emphasises the need for tax legislation to uphold constitutional standards, ensuring fair and equitable treatment for all.

For more details, contact the author and Penteris Head of Tax Piotr Prokocki.

Originally published in Wolters Kluwer’s Prawo.pl.