Borrowing money and donating in a family are not surprising. However, it is worth knowing how to use them, so as not to expose yourself to the tax office, because not all transactions in the family are tax-neutral.
We donate or lend ourselves – parents to children, children, parents, grandparents or other people who are part of the family. However, not everyone is aware of the fact that failure to comply with the relevant formalities related to such transactions may have tax consequences.
The most important degree of kinship
First of all, the tax consequences resulting from loans and donations depend on the degree of kinship between the parties to the transaction. It is worth getting to know the tax groups regarding family members in terms of the relationship between them.
• 0 – spouse, children, grandchildren, grand-grandchildren, parents, grandparents, great-grandparents, siblings, stepmother, step-father, stepson, stepdaughter
• I – group 0 and in-laws, daughter-in-law, son-in-law
• II – descendants of siblings, spouses of siblings and siblings of spouses, siblings of parents, spouses of siblings of spouses, descendants and spouses of stepchildren
• III – other people
Donations in the family
Donations between members belonging to a group marked as 0 are completely exempt from taxes without an upper quota limit. However, one must remember about meeting two conditions – submitting a donation application to the tax office on the SD-Z2 form within 6 months, and also a donation should be made as a transfer.
For other groups, tax-free amounts appear. In group I this limit is PLN 9,637, in group II PLN 7 276, while in group III PLN 4,902. If we make several donations for the same person, these limits apply for a 5-year period.
It is also worth mentioning that if the donation is made as a notarial deed, then we do not need to be killed in the tax office – a notary public is involved.
Loans in the family
Relatives who are included in group I do not have to pay tax on civil law transactions (PCC). This applies to a loan of up to PLN 9,637 – also the aforementioned five-year period applies. On the other hand, this does not apply to persons who belong to the group 0, that is, to the closest family – then there is no limit.
If the loan amount is higher than mentioned, in this case we must remember to notify the tax office, but this time within 14 days from the loan. In order to submit, we must use the PCC-3 document, that is the declaration on the tax on civil law transactions.
If the loan has been signed with the appropriate contract, the time is counted from the date on the contract, and not from the date of payment of the money. We should also present proof of receipt of money at the office – a transfer with a clear title that it is a loan .
The loan tax is 2 percent, but if we do not pay it on time, then it will be increased to 20 percent of the loan’s tax base.