A family foundation questions whether selling properties after long-term leases is exempt from Corporate Income Tax under Polish law.
Investment Strategy
The case concerns a family foundation planning to invest in residential properties. The foundation intended to acquire real estate, lease it for extended periods, and use rental income for further investments.
The foundation did not rule out selling the properties after at least ten years of ownership.
Tax Exemption Claim
The foundation argued it would not pay tax on income from property sales, citing an exemption in Article 6, paragraph 1, point 25 of the CIT Act.
It maintained that such transactions fall within the permitted business activities outlined in Article 5, paragraph 1, point 1 of the Family Foundation Act (Journal of Laws 2023, position 326 with amendments).
According to this provision, a family foundation may engage in business activities involving property disposal, provided the property was not acquired solely for the purpose of resale.