The Polish government has agreed to extend tax exemptions for donations received by those affected by the September 2024 floods for an additional year.
Donation Tax Relief Extension for Flood Victims
Individuals impacted by the September 2024 floods will have an extra year to utilize received donations for flood damage remediation without incurring donation tax. The Council of Ministers has adopted a draft amendment to facilitate this.
The draft will now be submitted to the Sejm for consideration, with the new regulations expected to take effect the day following their publication in the Journal of Laws.
Eligibility and Regulations
The changes apply to those affected by the flood residing in areas designated in the regulation of September 16, 2024, concerning the list of municipalities subject to special solutions related to the September 2024 flood and related measures.
Previously, individuals could benefit from the donation tax exemption under Article 30(2) of the special act on flood remediation, provided donations were used for flood damage repair by December 31st of the following year.
Extended Deadline for Tax-Exempt Donations
This initially meant donations used for flood recovery by those affected in September 2024 were exempt if allocated by the end of 2025. The government’s proposed amendment extends this deadline.
Under the proposed Article 19a, donations received for flood damage repair in affected municipalities will be exempt if used between January 1st and December 31st, 2026. This also applies to donations received between January 1st and December 31st, 2026, if used for flood remediation during that period.
Tax Office Procedures and Reporting
The Ministry of Finance clarified that individuals who did not utilize donations by the end of 2025 do not need to submit individual tax relief applications.
If a tax proceeding is underway, the tax office may suspend it until the end of 2026, allowing time for funds to be allocated. The proceeding may then be terminated or adjusted based on the portion of the donation not used for the specified purposes.
Unused Donations: SD-3 Declaration
If flood victims cannot allocate received donations for flood damage repair by the end of 2026, they must submit a tax declaration regarding the acquisition of property or rights (SD-3) by January 31st, 2027, potentially triggering tax liability.
Legislative Stage
The amendment to the inheritance and donation tax act (No. UD351) has been adopted by the Council of Ministers.