The word "neutrality" is spoken at the first meeting of every reorganisation project, and the board usually hears one thing: we will pay no tax when we carry this out. Sometimes that is right. It is never automatic. Neutrality is not a feature of a procedure in the Commercial Companies Code (Kodeks spółek handlowych, the CCC). It is the result of meeting statutory conditions — separately for each participant, each transaction and each tax. And most often it means not the absence of tax, but a shift in the moment when the tax falls due.
No tax is not the same as deferred tax
Proposition. In a typical reorganisation the shareholder does derive revenue; the statute merely moves the moment of taxation to the day the shares are disposed of for consideration.
Statutory basis. In PIT, the shareholder's revenue on a merger or a division is set by Article 24(5)(7) and (7a) (art. 24 ust. 5 pkt 7 i 7a) of the Personal Income Tax Act (ustawa o podatku dochodowym od osób fizycznych, the PIT Act), and the deferral is introduced by Article 24(8) of that Act, subject to Article 24(8da) and (8db). In CIT the drafting differs: Article 12(1)(8ba) (art. 12 ust. 1 pkt 8ba) sets the shareholder's revenue, while Article 12(4)(12) (art. 12 ust. 4 pkt 12) of the Corporate Income Tax Act (ustawa o podatku dochodowym od osób prawnych, the CIT Act) excludes it from revenue where the conditions are met.
Practice. The Director of the National Revenue Information Service (Dyrektor Krajowej Informacji Skarbowej, the Director of the KIS) put this plainly in an individual tax ruling of 20 August 2026, no. 0114-KDIP2-2.4011.93.2026.2.IN: "at the moment of the division of the company, in the light of Article 24(5)(7a) of the aforementioned Act, revenue will arise, but it will not be taxable at that moment. It therefore cannot be held that the division does not give rise to revenue. The moment of its taxation, however — because the remaining conditions are met — is deferred until the shares are disposed of for consideration" (translation by the author).
Takeaway. If you are planning a reorganisation ahead of a sale of the business or the entry of an investor, calculate the tax not only as at the reorganisation date but also as at the exit date. Neutrality at an intermediate step changes when the tax becomes payable; it does not change the economics of the final transaction.
Carry-over of tax values and historical cost on the new shares
Proposition. The deferral works through two parallel mechanisms: the carry-over of the tax values of the assets inside the company, and the transfer of the historical acquisition cost onto the shares the shareholder receives.
Statutory basis. On the acquiring company's side, Article 12(4)(3e) (art. 12 ust. 4 pkt 3e) of the CIT Act requires two things at once: the assets must be taken up for tax purposes at the value resulting from the tax books of the acquired entity, and they must be allocated to business carried on within the territory of the Republic of Poland. On the shareholder's side, Article 24(8) of the PIT Act requires the tax-deductible cost on a disposal of the new shares to be determined under Article 22(1f) (art. 22 ust. 1f) or Article 23(1)(38) (art. 23 ust. 1 pkt 38) of the PIT Act — that is, by reference to the expenditure incurred on the shares in the company being acquired or divided; on a spin-off, in proportion to the value of the assets.
Practice. In an individual tax ruling of the Director of the KIS of 11 June 2025, no. 0111-KDWB.4010.12.2025.2.KP, the authority stated: "revenue does not include any excess of the market value of the assets of the acquired entity over the value of those assets taken for tax purposes, if two conditions are met". The authority also stressed that Article 12(1)(8d) and (8f) of the CIT Act "are complementary" — which of them applies is determined by the acquiring company's holding in the share capital of the acquired company.
Takeaway. Neutrality does not remove the tax; it moves the tax base. Before the resolutions are passed, prepare a matrix of the tax and accounting values of every asset, and reconstruct the documented acquisition cost of the shares held by each shareholder. Without those two documents you will not later be able to show that the carry-over condition was met.
The statutory conditions in CIT and PIT
Proposition. Each type of reorganisation has its own set of conditions; satisfying the conditions attaching to one item of revenue does not close the analysis of the others.
Statutory basis. On a merger or a division, on the side of the company receiving the assets you test Article 12(1)(8c), (8d) and (8f) of the CIT Act together with the exclusions in Article 12(4)(3e) and (3f); on the side of the company being divided — Article 12(1)(9) and Article 12(4)(3h); on the shareholder's side — Article 12(1)(8b) and (8ba) and Article 12(4)(12). On an exchange of shares the decisive provisions are Article 12(4d) (art. 12 ust. 4d) and Article 12(11)–(12b) of the CIT Act and Article 24(8a)–(8c) of the PIT Act: acquiring or increasing an absolute majority of voting rights, a cash payment of no more than 10% of the nominal value of the shares issued, and allocation of at least part of the contribution to share capital.
Practice. As the individual tax ruling of the Director of the KIS of 20 May 2026, no. 0114-KDIP3-1.4011.345.2026.1.MK1, warns, the voting-majority condition is assessed shareholder by shareholder, not deed by deed: "Even though the shares will be contributed by all the shareholders at the same time (in the same transaction), the position of each shareholder must be assessed separately in the light of Article 24(8c) of the Personal Income Tax Act". The authority held the applicant's position to be incorrect: a shareholder contributing 2.66% of the shares recognised revenue under Article 17(1)(9) (art. 17 ust. 1 pkt 9) of the PIT Act, even though the shareholders together contributed 100% of the capital.
Takeaway. When you build a holding structure by a single notarial deed, check whether any one shareholder gives the acquiring company an absolute majority of voting rights on its own. If none does, assume that the others will recognise revenue.
Neutrality only once: a second reorganisation of the same shares
Proposition. The exclusion from revenue applies only where the shares in the company being acquired or divided do not themselves come from an earlier reorganisation. The condition attaches to the history of a specific block of shares, not to the number of transactions carried out in the group.
Statutory basis. Under Article 12(4)(12)(a) (art. 12 ust. 4 pkt 12 lit. a) of the CIT Act, the exclusion applies where "the shares (stock) in the acquired or divided entity were not acquired or taken up as a result of an exchange of shares, or allotted as a result of another merger or division of entities"; point (b) of that provision adds the condition that the tax value be carried over. The PIT counterpart is Article 24(8db)(1) of the PIT Act, which switches off the deferral under Article 24(8), together with Article 24(8b)(3) for an exchange of shares. The burden of proof rests on the shareholder — Article 12(12b) of the CIT Act and Article 24(8dc) of the PIT Act.
Practice. In an individual tax ruling of 16 March 2026, no. 0114-KDIP2-1.4010.7.2026.3.DK, the Director of the KIS examined this condition at the level of fact: the applicant "holds 100% of the shares in C., and those shares were not acquired or taken up by the Applicant as a result of an exchange of shares, nor allotted as a result of another merger or division of entities, but under a contract of sale". Only once that had been established could the authority accept that the cross-border merger "will not give rise, on the part of the shareholder of the acquired company, to revenue subject to tax, under Article 12(4)(12) in conjunction with Article 12(1)(8ba) of the CIT Act".
Takeaway. Reconstruct the source of every block of shares: purchase, cash contribution, contribution in kind, exchange of shares, allotment on a merger or a division. Shares bought in an ordinary sale do not become "post-reorganisation shares" merely because the group was reorganised at some earlier point. Whether this restriction is compatible with Directive 2009/133/EC is the subject of a request for a preliminary ruling made by the Provincial Administrative Court in Gliwice on 1 July 2025 in Case C-434/25 SANOFI. The referral alone does not set aside the national provision and is not in itself a ground for disapplying it; until the case is decided, the condition has to be built into the calculation.
The specific anti-avoidance clause and valid economic reasons
Proposition. Even a complete set of positive conditions is not enough if a negative condition is triggered: that the purpose of the transaction was tax avoidance or tax evasion.
Statutory basis. Article 12(13) of the CIT Act switches off Article 12(4)(3e)–(3h), (12) and (25)(b) and Article 12(4d) "where the main purpose or one of the main purposes of a merger of companies, a division of companies, an exchange of shares or a contribution in kind is tax avoidance or tax evasion". Article 12(14) adds a presumption: if the transactions "were not carried out for valid economic reasons, then for the purposes of paragraph 13 it is presumed" that this was their main purpose. The PIT counterparts are Article 24(19) and (20). Independently of those provisions, the general anti-avoidance rule in Article 119a § 1 of the Tax Ordinance (Ordynacja podatkowa) applies, which requires, cumulatively, a benefit contrary to the object or purpose of the provision, a predominant tax purpose and an artificial manner of acting.
Practice. The authorities take the economic justification from the description of the future event and do not test it evidentially. In ruling no. 0114-KDIP2-2.4011.93.2026.2.IN the Director of the KIS relied on a statement that the division "will be carried out for valid economic reasons". The protection a ruling affords is limited by Article 14na § 1 of the Tax Ordinance, which switches off Articles 14k–14n where the transaction described forms part of a transaction covered by a decision issued under Article 119a.
Takeaway. A ruling confirms how the provision is to be read on the description submitted; it does not confirm that the stated motives are true. Prepare the documentation of the business purpose — the analysis of the options, the reasons for the choice, the minutes of the decisions — before the resolutions are passed. For complex sequences of transactions, consider a protective opinion under Article 119w et seq. of the Tax Ordinance.
What neutrality leaves out
Proposition. Excluding revenue for income tax purposes does not carry across to the other taxes or to reporting obligations.
Statutory basis and practice. The table below sets out the areas that have to be analysed separately.
| Area | Effect where the conditions are met | Legal basis | What has to be checked separately |
|---|---|---|---|
| CIT — acquiring company | No revenue from the excess of market value over the tax value of the assets | Article 12(1)(8c) and Article 12(4)(3e) of the CIT Act | Points (8d) and (8f) separately; use of tax losses; issue value of the shares |
| CIT/PIT — shareholder | Revenue excluded, or deferred to the day the shares are disposed of | Article 12(4)(12) of the CIT Act; Article 24(8) of the PIT Act | Acquisition history of the block of shares; cash payments; cost as at the exit date |
| VAT | Disposal of an enterprise or of a ZCP falls outside the scope of the Act | Article 6(1) of the VAT Act (ustawa o podatku od towarów i usług) | ZCP status; input tax adjustment at the acquirer (Article 91(9)); individual assets taxed under the general rules |
| PCC | Articles of association and amendments to them connected with mergers, divisions and conversions of capital companies are excluded | Article 2(6) of the Tax on Civil Law Transactions Act (ustawa o podatku od czynności cywilnoprawnych, the PCC Act) | Which entities the exclusion covers; Article 1(3) for partnerships; a sale of shares outside the reorganisation |
| Tax succession | Succession to the rights and obligations of the predecessor | Articles 93–93e of the Tax Ordinance | On a division — the scope of Article 93c is limited to rights connected with the assets being spun off |
| MDR | Neutrality is not a ground for exemption | Article 86a et seq. of the Tax Ordinance | Main benefit test; hallmarks; the rules in force from 1 October 2026 |
| Transfer pricing | No exemption for intra-group transactions | Article 11a et seq. of the CIT Act | Local file, TPR reporting, remuneration for the transfer of functions and risks (exit fee) |
| Accounting | Tax neutrality does not mean accounting neutrality | Article 12 and Articles 44a–44d of the Accounting Act (ustawa o rachunkowości) | Closing and opening of the books; goodwill; differences between accounting and tax values |
MDR deserves separate attention. General tax ruling no. DTS5.8092.3.2025 of the Minister of Finance and Economy (Minister Finansów i Gospodarki) of 29 July 2025 concerns how an increase in the share capital of a capital company is to be classified under the reportable arrangement (MDR) rules in the context of the Tax on Civil Law Transactions Act. It follows from that ruling that the mere absence of PCC on the share premium (agio) does not settle whether an arrangement exists, but deliberately limiting the nominal value of the increase solely in order to reduce the PCC base may satisfy the main benefit test.
Takeaway. Work through every row of the table above in parallel, not in sequence. An element of the project that is neutral for CIT may, in the same month, call for a PCC-3 return, an input tax adjustment, an MDR-1 filing and transfer pricing documentation.
The most common mistake
The most common mistake is to assume that because a transaction is provided for in the Commercial Companies Code and is carried out under its procedure, it is tax-neutral. The board commissions the merger plan, the resolutions and the application to the KRS register, and the tax analysis is produced after registration — or only when the tax authority asks its first question.
The consequences follow a pattern. Nobody reconstructed the history of the blocks of shares, so the condition in Article 12(4)(12)(a) of the CIT Act or in Article 24(8db)(1) of the PIT Act turns out not to be met, and the burden of proof rests on the shareholder. No matrix of tax values was drawn up, so the carry-over required by Article 12(4)(3e) of the CIT Act cannot be demonstrated. The business justification is written after the event and comes down to a sentence about "simplifying the structure", which, against the presumption in Article 12(14) of the CIT Act, is difficult material to defend.
Reverse the order of work. Establish the business purpose and the alternative options first, then run the CIT, PIT, VAT, PCC, succession, MDR, transfer pricing and accounting analysis, and only at the end choose the instrument from the Commercial Companies Code. The documentation of the business purpose must exist before the resolutions; back-dating is not a solution and makes the evidential position worse.
Summary
- Establish whose neutrality the analysis concerns: the acquiring company, the company being divided, the company receiving the contribution or the shareholder. Each of them has its own revenue provision and its own exclusion.
- Distinguish the absence of tax from deferral. On a merger or a division the shareholder derives revenue as a rule, and taxation moves to the day the shares are disposed of for consideration.
- Reconstruct the history of every block of shares and document their acquisition cost. The statute places the burden of proof on the shareholder (Article 12(12b) of the CIT Act, Article 24(8dc) of the PIT Act).
- Prepare the documentation of the valid economic reasons before the resolutions are passed. The protection a ruling affords is limited by Article 14na of the Tax Ordinance.
- Run the VAT, PCC, succession, MDR, transfer pricing and accounting analysis in parallel. The absence of current income tax does not relieve you of any of those obligations.
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 11 June 2025, no. 0111-KDWB.4010.12.2025.2.KP — no revenue for the acquiring company on a merger by acquisition of a wholly owned subsidiary; Article 12(1)(8ba), (8c), (8d) and (8f) and Article 12(4)(3e) of the CIT Act. https://eureka.mf.gov.pl/informacje/podglad/643735
- Individual tax ruling of the Director of the National Revenue Information Service of 16 March 2026, no. 0114-KDIP2-1.4010.7.2026.3.DK — cross-border merger; examination of the condition in Article 12(4)(12)(a) of the CIT Act at the level of how the shares were acquired. https://eureka.mf.gov.pl/informacje/podglad/683874
- Individual tax ruling of the Director of the National Revenue Information Service of 20 May 2026, no. 0114-KDIP3-1.4011.345.2026.1.MK1 — exchange of shares where all the shareholders contribute their shares at the same time; the applicant's position held to be incorrect; Article 24(8a)–(8c) of the PIT Act. https://eureka.mf.gov.pl/informacje/podglad/693188
- Individual tax ruling of the Director of the National Revenue Information Service of 20 August 2026, no. 0114-KDIP2-2.4011.93.2026.2.IN — division by spin-off; deferral of taxation of the shareholder under Article 24(8) of the PIT Act where the negative conditions in Article 24(8db) are not met. https://eureka.mf.gov.pl/informacje/podglad/706338
- General tax ruling no. DTS5.8092.3.2025 of the Minister of Finance and Economy of 29 July 2025 on the classification of an increase in the share capital of a capital company under the reportable arrangement rules in the context of the Act of 9 September 2000 on the tax on civil law transactions; Dz. Urz. Min. Fin. i Gosp. z 2025 r. poz. 1.
- Request for a preliminary ruling lodged by the Provincial Administrative Court in Gliwice on 1 July 2025 — Case C-434/25 SANOFI, notice published at Dz.Urz. UE C/2025/5567 z dnia 27 października 2025 r. (EUR-Lex, CELEX 62025CN0434). The case concerns whether the national restriction of neutrality based on the history of the shares is compatible with Directive 2009/133/EC. As at the date of publication the case remains pending: no judgment has been delivered and no Advocate General's Opinion has been presented.
E-book references
Selected restructuring topics are discussed at greater length in the e-book series Biblioteka Restrukturyzacji (Restructuring Library; Zbyszko Pora, JTWPOLAND): converting a sole trader into a sp. z o.o., the division of a company by spin-off or by separation, and the test for an organised part of an enterprise. The PDF files are available free of charge in the e-book section; the series is currently published in Polish.
Why we do this
As a tax advisor I take care of the substantive quality of our free materials. My aim is to educate the market through reliable analyses that allow entrepreneurs to apply the law safely in practice.
Get in touch →Legal basis: Act of 15 September 2000 — Commercial Companies Code (consolidated text: Dz.U. z 2024 r. poz. 18, as amended); Act of 15 February 1992 on corporate income tax (consolidated text: Dz.U. z 2026 r. poz. 554, as amended); Act of 26 July 1991 on personal income tax (consolidated text: Dz.U. z 2026 r. poz. 592, as amended); Act of 11 March 2004 on the tax on goods and services (consolidated text: Dz.U. z 2025 r. poz. 775, as amended); Act of 9 September 2000 on the tax on civil law transactions (consolidated text: Dz.U. z 2026 r. poz. 191); Act of 29 August 1997 — Tax Ordinance (consolidated text: Dz.U. z 2026 r. poz. 622, as amended); Act of 29 September 1994 on accounting (consolidated text: Dz.U. z 2026 r. poz. 522, as amended); Act of 29 May 2026 amending the Tax Ordinance and certain other acts (Dz.U. z 2026 r. poz. 846) — MDR changes in force from 1 October 2026; Council Directive 2009/133/EC of 19 October 2009 on the common system of taxation applicable to mergers, divisions, partial divisions, transfers of assets and exchanges of shares concerning companies of different Member States and to the transfer of the registered office of an SE or SCE between Member States (Dz.Urz. UE L 310 z 25.11.2009, s. 34)