Changes to the Family Foundations Act

Although the Act on Family Foundations of 26 January 2023 (the Act) has not taken effect yet, the legislator already considers it necessary to amend its provisions. The changes were presented in the Bill amending the Act on Bonds, the Act on Investment Funds and Alternative Investment Fund Management and the Act on the Banking Fund (the Bill).

Forfeiture of the right to the corporate income tax exemption

The Bill provides that a family foundation that has not been registered on the register of family foundations within six months of its establishment, or with respect to which the registry court issued a decision denying registration, shall forfeit the right to be exempted from CIT.  The right to the exemption ceases to apply from the moment the family foundation under organization is established.

Lease or rental of company assets

If revenues are gained from lease, rental or other contracts of similar nature, the objects of which consist of an undertaking, an organized part of an undertaking or assets used to run a business activity by the beneficiary, the founder or an entity related to the family foundation, the beneficiary or the founder, the family foundation cannot benefit from the tax exemption.

Beneficiary/founder and the Estonian CIT

The bill provides that natural persons who are beneficiaries or founders of a family foundation can simultaneously be partners/shareholders in companies/partnerships taxed with the Estonian CIT. Invariably however a family foundation cannot be a partner/shareholder in a company taxed according to the rules of the Estonian CIT.

Hidden profits

The bill provides for a 15% tax on hidden profits distribution made by the Foundation. The payments are to be taxed in the same way as payments made to the beneficiary or resulting from dissolution of the family foundation. The bill contains a list of activities representing hidden profit distribution.

Payments made to persons of the 1st and 2nd tax group.

According to its existing wording, the Act provides that payments made to the “zero” group would be exempt from PIT. All other payments are to be taxed with 15% PIT. The bill provides for relaxation in this respect: payments to more distant family members, i.e. those of the 1st and 2nd tax group would be taxed at 10% PIT. These provisions are addressed to more distant relatives who cannot benefit from the exemption for the “zero” group.


The legislator’s activity indicates that the final model of operation of a family foundation may still undergo changes. The solutions are currently processed by the parliament. The planned regulations are to take effect on 22 May 2023, i.e. at the same time as the previously adopted Act.


Elżbieta Lis Partner, Katowice

T: +48 32 731 68 58
M: +48 664 948 038

Piotr Krupa Partner, Katowice

T: +48 32 731 68 52
M: +48 502 109 333

Rafał Ciołek Partner, Warsaw

T: +48 22 690 08 61
M: +48 604 496 335

Bartłomiej Wietrzychowski Senior Associate, Warsaw

T: +48 22 690 08 88

Katarzyna Chrapowicka Director, Warsaw

T: +48 22 690 08 88