In a division by wydzielenie, the divided company’s shareholders receive shares in the recipient; in wyodrębnienie, the divided company itself receives them. This is the fundamental ownership difference, while the exact ownership structure follows the plan and may involve an existing recipient. The recipient’s tax tests and the shareholders’ position differ. Choose the form by its commercial purpose, then assess CIT, any PIT, ZCP status and succession separately.
Two routes, two different ownership outcomes
Proposition. A partial division separates the business horizontally; a division by separation builds it vertically.
Statutory basis. Under Article 529 § 1(4) (art. 529 § 1 pkt 4) of the Commercial Companies Code (Kodeks spółek handlowych, the CCC), a division may take place by transferring part of the assets of the company being divided to an existing or a newly formed company in exchange for shares or stock "taken up by the shareholders of the company being divided". Article 529 § 1(5) of the CCC describes the same transfer of assets, but in exchange for shares or stock "taken up by the company being divided". In both cases the company being divided retains its legal existence — it is not struck from the register.
Practice. The interpreting authority reads that difference literally. In an individual tax ruling of the Director of the National Revenue Information Service (Dyrektor Krajowej Informacji Skarbowej, the Director of the KIS) of 3 June 2025, no. 0111-KDIB1-1.4010.157.2025.2.AND, it was stated, with reference to a partial division, that "the company being divided does not cease to exist; all that happens is that part of its assets is transferred to another entity" (translation by the author).
Takeaway. Determine whether the shares should go to a shareholder, who may be an individual or another entity, or to the divided company. Wydzielenie may separate shareholders or prepare succession or a segment sale; wyodrębnienie may build a holding relationship. Neither automatically establishes identical shareholder bases or full control over an existing recipient. The plan, exchange ratio and existing holdings determine that.
Where division by separation came from, and why
Proposition. Division by separation has been part of the Polish system since 15 September 2023 and was introduced as part of the implementation of the EU directive on cross-border reorganisations.
Statutory basis. Article 529 § 1(5) of the CCC was introduced by the Act of 16 August 2023 amending the Commercial Companies Code and certain other acts (Dz.U. poz. 1705), which implemented, among others, Directive (EU) 2019/2121 as regards cross-border conversions, mergers and divisions of companies. The new provisions entered into force on 15 September 2023.
Practice. The legislature's purpose was to tidy up the law: until then, moving a set of assets into a subsidiary required a contribution in kind, and with it individual assignments, counterparty consents and assumptions of debt. A separation produces the same commercial result under the partial succession regime of the Commercial Companies Code. Tax law caught up with the Code late — the CIT Act provisions dedicated to this route (Article 12(1)(7) and Article 12(4)(25)(c) and Article 15(1lb) of the CIT Act) have applied only since 18 September 2025.
Takeaway. If you are analysing a project on the basis of older commentary, check the date. Conclusions on the CIT consequences of a separation drawn before 18 September 2025 may no longer match the wording of the statute.
Partial division versus division by separation — a comparison
| Criterion | Partial division (Article 529 § 1(4) of the CCC) | Division by separation (Article 529 § 1(5) of the CCC) | Practical consequence |
|---|---|---|---|
| Who takes up the shares or stock | The shareholders of the company being divided | The company being divided | Determines the structure of the group after the division date |
| Structure after the operation | Typically sister companies; exact ownership and its separation follow the plan | The divided company receives a stake in the recipient; control depends on the structure | A partial division separates control; a division by separation consolidates it |
| Effect on a shareholder who is a natural person | An event covered by Article 24(5)(7) or (7a) of the PIT Act | As a rule no enrichment arises merely because the company takes up the shares | On a partial division, a PIT analysis of the shareholders is mandatory |
| CIT test for the recipient of the assets | Article 12(1)(8c), (8d) and, where relevant, (8f), with the exclusions in Article 12(4)(3e) and (3f) | Article 12(1)(7) with the exclusion in Article 12(4)(25)(c) | The same assets, a different revenue provision |
| ZCP condition | Required both for the assets transferred and for those remaining | Required on both sides for Article 12(4)(3h) of the CIT Act and Article 93c § 2 of the Tax Ordinance | Always two parallel ZCP matrices |
| Specific anti-avoidance clause | Article 12(13)–(14) of the CIT Act covers Article 12(4)(3e)–(3h) and (12) | The list in Article 12(13) names point (25)(b) but not point (25)(c) | A different scope of examination; the GAAR in Article 119a of the Tax Ordinance applies regardless |
| Typical use | Separating shareholders, succession, preparing for a sale | Holding structure, special purpose vehicle, an investor entering a single segment | The route is chosen to fit the objective, not the other way round |
ZCP on both sides: a condition there is no way around
Proposition. In a partial division, an organised part of an enterprise has to be established twice — for the assets being transferred and for the assets remaining in the company being divided.
Statutory basis. Article 12(1)(9) CIT concerns the divided company. In wydzielenie or wyodrębnienie, a failure of either transferred or retained assets to meet the ZCP test may create revenue equal to the market value of the transferred assets; Article 12(4)(3h) provides the corresponding exclusion. Article 24(5)(7) PIT separately concerns a shareholder receiving shares in a division, including wydzielenie. Do not apply it automatically to wyodrębnienie, where the company itself receives the shares. ZCP definitions appear in Article 4a(4) CIT and Article 2(27e) VAT.
Practice. In an individual tax ruling of the Director of the KIS of 31 January 2025, no. 0115-KDIT1.4011.697.2024.3.MN, the authority set the two conditions side by side: "In the case of a partial division, a taxpayer (a shareholder of the company being divided) may derive the revenue (income) referred to in the above provisions if: he receives cash payments and/or; the assets taken over as a result of the division, or the assets remaining in the company being divided, do not constitute an organised part of an enterprise".
Takeaway. Neutrality on the company's side does not automatically carry across to the shareholder, or the other way round. Prepare two separate ZCP matrices and calculate the consequences separately for each participant: the company being divided, the acquiring company and each shareholder. We cover the definition itself in more detail in our article on the organised part of an enterprise.
Neutrality on the acquiring company's side
Proposition. On the acquiring company's side revenue arises as a rule; neutrality lies in that revenue being excluded, not in its never arising.
Statutory basis. Article 12(1)(8c) of the CIT Act makes revenue of the excess of the market value of the assets received over the value of those assets taken for tax purposes. Article 12(4)(3e) of the CIT Act excludes that amount where the acquiring company takes up the assets at the value resulting from the tax books of the company being divided and allocates them to business carried on within the territory of the Republic of Poland. Both conditions must be met together.
Practice. The ruling of 3 June 2025 cited above sets the mechanism out step by step: "Accordingly, as a result of the division, revenue will arise on the part of the Acquiring Company under Article 12(1)(8c) of the CIT Act. It will, however, be excluded under Article 12(4)(3e) of the CIT Act". In the same case the authority disagreed with the applicant that the consequences of a division can be derived from a single provision, pointing out that "the legislature did not provide that revenue from taking over the assets of a divided entity may arise only under one of the above provisions".
Takeaway. The example above and the tests in Article 12(1)(8c), (8d) and, where relevant, (8f) concern wydzielenie. Carry-over values and Polish business allocation may exclude point 8c but do not replace the other tests. For wyodrębnienie, the recipient instead applies Article 12(1)(7) and the exclusion in paragraph 4(25)(c): the transferred assets must constitute a ZCP and be recorded at the divided company’s tax-book values. Retained assets are assessed separately for the divided company and for succession.
Tax succession: what actually passes
Proposition. Partial tax succession is limited to rights and obligations connected with the allocated assets.
Statutory basis. Article 93c § 1 (art. 93c § 1) of the Tax Ordinance (Ordynacja podatkowa) transfers to the acquiring or newly formed company those rights and obligations of the company being divided that are "connected with the assets allocated in the division plan". Paragraph 2 makes this conditional on the assets taken over — and, in a partial division and a division by separation, also the assets remaining — constituting a ZCP. Article 93e reserves priority for special provisions.
Practice. In its judgment of 23 May 2024, case ref. III FSK 741/23, the Supreme Administrative Court (Naczelny Sąd Administracyjny) confirmed that a company formed as a result of a division covering an organised part of an enterprise succeeds to those rights and obligations of the company being divided that are connected with the assets allocated to it, including the right to a refund of an overpayment relating to a period before it came into existence.
Takeaway. Map each right and obligation under Article 93c, its connection with the allocated assets and the relevant tax rules. Filing a return or paying tax for an earlier period does not establish that every related right stays with the divided company: a successor may also acquire a claim to an overpayment for a pre-division period, as the judgment illustrates. Labels such as open and closed positions cannot replace this analysis. Tax losses remain subject to the separate restrictions in Article 7(3)(4) and (4) CIT.
VAT and PCC
Proposition. If the subject of the division is an enterprise or a ZCP, the operation falls outside the scope of the VAT Act; and the division as such is not subject to PCC.
Statutory basis. Article 6(1) of the VAT Act excludes the application of the Act to a transaction disposing of an enterprise or of a ZCP. Article 91(9) of the VAT Act passes the obligation to adjust input tax to the acquirer. For VAT purposes only the set of assets being transferred is examined — the Act imposes no additional ZCP condition in respect of the assets remaining with the transferor.
Practice. The direction of interpretation is set by the judgment of the Court of Justice of the European Union of 27 November 2003 in Case C-497/01 Zita Modes Sàrl, ECLI:EU:C:2003:644: the set of assets transferred must make it possible to carry on an independent business, and the acquirer must intend to continue that business rather than to wind it up immediately.
Takeaway. For every division, prepare a VAT timetable: handing over the data on the remaining periods of the multi-year adjustment, splitting the invoicing as at the date of the partial division, registering the new company and reflecting it in JPK_V7.
For PCC purposes, a division of a company falls neither within the closed list of transactions nor within the amendments to articles of association in Article 1(1) and (3) of the Tax on Civil Law Transactions Act (ustawa o podatku od czynności cywilnoprawnych, the PCC Act) — and that holds even where the division results in an increase of share capital. There is no taxable object here, rather than an exemption. Assess the accompanying transactions separately: contracts of sale, loans, the creation of a mortgage or additional payments by shareholders may be subject to PCC on their own terms.
The date of the partial division, the division plan, creditors
Proposition. The date of succession is the date of registration, not the date of the resolution.
Statutory basis. Under Article 530 § 2 of the CCC, the date of the partial division or of the division by separation is the date on which the newly formed company is entered in the register or — in the case of an existing company — the date on which the increase of its share capital or the issue of new shares without nominal value is registered. The valuations required by Article 12 of the CIT Act are made as at the day preceding that date.
Practice. The division plan is the document that determines the scope of succession, which is why a gap in the allocation of assets or liabilities turns into a dispute after the registration date. For a separation, Article 529 § 2 of the CCC disapplies some of the procedural requirements, including the management board's report under Article 536 § 1 of the CCC — which does not remove the need to prepare a business justification for tax purposes. The protection of creditors and the joint and several liability of the companies taking part in the division (Article 546 of the CCC) remain independent of the tax analysis.
Takeaway. Fix the date of the partial division together with the accounting team, and do it before registration rather than after. Synchronise invoicing, payroll, period closes, the updating of bank accounts and of the white list, and the notifications to banks, lessors and grant institutions to that date.
The most common mistake
The most common mistake is to build the set of assets being transferred purely "on paper": a management board resolution calls it a unit, the division plan calls it an organised part of an enterprise — and that is as far as the segregation goes. There is no separate analytical ledger, no assigned employees and no services replacing their functions, no supplier or customer contracts and no liabilities, and the assets being transferred are incapable of performing any economic task on their own.
The authority assesses the facts, not the label. In an individual tax ruling of the Director of the KIS of 4 June 2025, no. 0111-KDIB1-1.4010.154.2025.2.MF, it was stated expressly: "an organised part of an enterprise is not the sum of the individual assets with which a separate establishment could be run, but an organised set of those assets, the point of reference being the role that the assets play in the functioning of the enterprise".
How to avoid this: organisational, financial and functional separation must exist before the division date and must be documented as it happens — by internal rules and an organisational chart, by analytical accounts and cost centres, by a profit and loss account for the unit, by a schedule of contracts, a list of employees and a schedule of the liabilities functionally assigned to the business. In the same ruling the authority accepted a ZCP only after establishing that the finance and accounting systems allowed results to be reported separately, receivables and liabilities to be assigned, and budgets to be prepared for each unit individually. The documentation must describe a functioning business, not a plan to organise one in the future.
Summary
- Decide first who is to take up the shares in the acquiring company — the shareholders or the company being divided. That decision determines the division route, not the other way round.
- Test transferred and retained ZCP status for Article 12(1)(9) and (4)(3h) CIT and Article 93c of the Tax Ordinance. Assess Article 24(5)(7) PIT for a shareholder receiving shares in wydzielenie, not automatically in wyodrębnienie.
- Assign the recipient’s correct regime: points 8c/8d/possibly 8f for wydzielenie; point 7 and paragraph 4(25)(c) CIT for wyodrębnienie. Do not automatically transfer tests between the two.
- Map the succession under Article 93c of the Tax Ordinance item by item, separating open items from closed ones and leaving tax losses out.
- When choosing the route, check which clause has to be examined: Article 12(13)–(14) of the CIT Act has a different scope for a partial division and for a division by separation, and the GAAR in Article 119a of the Tax Ordinance applies in both cases.
Sources cited
All quotations from Polish-language sources — statutes, tax rulings and court judgments — are given here in the author's translation; the Polish wording is authoritative.
- Individual tax ruling of the Director of the National Revenue Information Service of 3 June 2025, no. 0111-KDIB1-1.4010.157.2025.2.AND — the consequences of a partial division for an acquiring company that is the sole shareholder of the company being divided; Article 12(1)(8c), (8d) and (8f) and Article 12(4)(3e) and (3f) of the CIT Act. https://eureka.mf.gov.pl/informacje/podglad/642917
- Individual tax ruling of the Director of the National Revenue Information Service of 4 June 2025, no. 0111-KDIB1-1.4010.154.2025.2.MF — the conditions for an organised part of an enterprise in a partial division. https://eureka.mf.gov.pl/informacje/podglad/642621
- Individual tax ruling of the Director of the National Revenue Information Service of 31 January 2025, no. 0115-KDIT1.4011.697.2024.3.MN — the consequences of a partial division for a shareholder who is a natural person; Article 24(5)(7) and (7a) and Article 24(8) of the PIT Act. https://eureka.mf.gov.pl/informacje/podglad/624577
- Judgment of the Supreme Administrative Court of 23 May 2024, case ref. III FSK 741/23 — the scope of tax succession of a company formed as a result of a division, under Article 93c of the Tax Ordinance. CBOSA — III FSK 741/23
- Judgment of the Court of Justice of the European Union of 27 November 2003 in Case C-497/01 Zita Modes Sàrl v Administration de l'enregistrement et des domaines, ECLI:EU:C:2003:644 — the transfer of a totality of assets or part thereof and the acquirer's intention to carry on the business.
E-book reference
A full account of both division routes — together with a variant-selection sheet, a template for two descriptions of organised parts of an enterprise, a register of transitional items and an implementation timetable — is set out in the e-book Podział spółki: wydzielenie czy wyodrębnienie? Procedura, podatki i dokumentacja (Division of a company: partial division or division by separation? Procedure, taxes and documentation; Zbyszko Pora, JTWPOLAND) from the Biblioteka Restrukturyzacji series. The PDF is available free of charge in the e-book section; the publication is in Polish.
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Get in touch →Legal basis: Act of 15 September 2000 — Commercial Companies Code (consolidated text: Dz.U. z 2024 r. poz. 18, as amended) — Articles 528–531, Article 529 § 1(4) and (5), Article 529 § 2, Article 530 § 2, Articles 533–538¹, 546 and 550.; Act of 16 August 2023 amending the Commercial Companies Code and certain other acts (Dz.U. z 2023 r. poz. 1705) — introduction of division by separation; entry into force on 15 September 2023.; Act of 15 February 1992 on corporate income tax (consolidated text: Dz.U. z 2026 r. poz. 554, as amended) — Article 4a(4) and (16a); Article 7(3)(4) and Article 7(4); Article 12(1)(7), (8c), (8d), (8f) and (9), Article 12(4)(3e), (3f), (3h), (12) and (25)(c), Article 12(13)–(16); Article 15(1lb) and (1ł).; Act amending the Energy Law and certain other acts (Dz.U. z 2025 r. poz. 1218) — the CIT provisions on division by separation, in force since 18 September 2025.; Act of 26 July 1991 on personal income tax (consolidated text: Dz.U. z 2026 r. poz. 592, as amended) — Article 24(5)(6), (7) and (7a), Article 24(8), (8da)–(8db) and (19)–(20).; Act of 11 March 2004 on the tax on goods and services (consolidated text: Dz.U. z 2025 r. poz. 775, as amended) — Article 2(27e), Article 6(1), Article 91(9).; Act of 9 September 2000 on the tax on civil law transactions (consolidated text: Dz.U. z 2026 r. poz. 191) — Article 1(1)–(3), Article 2(6).; Act of 29 August 1997 — Tax Ordinance (consolidated text: Dz.U. z 2026 r. poz. 622, as amended) — Articles 93c–93e, Articles 119a and 119c.; Directive (EU) 2019/2121 of the European Parliament and of the Council of 27 November 2019 (Dz.Urz. UE L 321 z 12.12.2019, s. 1).; Council Directive 2006/112/EC of 28 November 2006 (Dz.Urz. UE L 347 z 11.12.2006, s. 1).