As a rule, a donation is subject to taxation in accordance with the provisions of the Inheritance and Donations Tax Act. This also applies to enterprises. However, there are situations in which the exemption from such tax is possible.
The Civil Code defines an enterprise as an organized set of tangible and intangible assets intended to conducting business activity.
Making a donation of enterprise, within the 1st tax group which includes ascendants, descendants, spouses or siblings, does not cause tax consequences on the ground of inheritance tax nor donation tax.
Furthermore, it is not necessary to report to the tax office the fact of receiving the enterprise by donation, because the donation will be made in the form of a notarial deed.
The transfer of the enterprise by donation does not cause tax consequences on the ground of the Personal Income Tax (PIT) – either on the side of the donor or the donee. More important, such transfer is not subject to VAT.
Our Law Firm provides consulting services in the tax aspects of donations of enterprises.
Please do not hesitate to contact us, if you are interested in learning more details.