Heirs living in the United States who inherit estate in Poland must complete a number of formalities. In addition to conducting probate proceedings, they are generally also required to report the acquisition of the estate to the Polish tax office. Importantly, the mere fact that an heir does not reside in Poland does not release them from tax obligations.
When Is Inheritance Tax Due?
Inheritance and donation tax applies to the acquisition by an individual heir of ownership of assets located in Poland or property rights exercised in Poland.
However, inheritance tax will not apply to the acquisition of ownership of movable property located in Poland or property rights exercised in Poland if, on the date of acquisition, neither the heir nor the deceased had:
- Polish citizenship, and
- permanent residence or registered office in Poland.
This exclusion applies to movable property only, which means it does not apply to a house, land, or an apartment.
If the heir had Polish citizenship or permanent residence in Poland at the time of the deceased’s death, the acquisition of assets or property rights located outside Poland may also be subject to tax in Poland.
Can an Heir Living in the U.S. Avoid Inheritance Tax in Poland?
Polish inheritance tax regulations provide for a number of exemptions from the obligation to pay inheritance tax.
These exemptions may be used only by an heir who, at the time of acquiring the inheritance, held Polish citizenship or citizenship of one of the Member States of the European Union or of the Member States of the European Free Trade Association (EFTA) that are parties to the Agreement on the European Economic Area, or who had their place of residence in the territory of the Republic of Poland or in the territory of such a state.
If the citizenship requirements are met, an heir living in the U.S. may avoid paying inheritance tax, among other things, in the case of acquiring:
- ownership of assets or property rights by a spouse, descendants, ascendants, stepchild, siblings, stepfather, or stepmother, provided that the acquisition is reported to the competent head of the tax office within 6 months from the date on which the court decision confirming the acquisition of inheritance becomes final, from the date of registration of the notarial deed of succession certification, or from the date of issuance of the European Certificate of Succession;
- ownership of land constituting an agricultural holding, subject to specific statutory conditions;
- works of art and manuscripts created by the deceased, as well as library materials, if the deceased was engaged in creative, scientific, educational, artistic, literary, or journalistic activity;
- movable monuments and collections entered in the register of monuments, as well as monuments loaned to a museum for scientific or exhibition purposes for a period of at least 2 years;
- household furnishings, bedding, clothing, underwear, and work tools intended for household use, acquired by persons classified in Tax Group I or Tax Group II;
- immovable monuments entered in the register of monuments, acquired by persons classified in Tax Group I or Tax Group II, provided that the purchaser secures and maintains them in accordance with applicable regulations.
Tax Group I includes: spouse, descendants, ascendants, stepchild, son-in-law, daughter-in-law, siblings, stepfather, stepmother, and parents-in-law.
Tax Group II includes: descendants of siblings, siblings of parents, descendants and spouses of stepchildren, spouses of siblings and siblings of spouses, spouses of siblings of spouses, and spouses of other descendants.
When Does the Tax Obligation Arise?
The tax obligation arises when the court decision confirming the acquisition of inheritance becomes final, when the notarial deed of succession certification is registered, or when the European Certificate of Succession is issued.
If the heir is not eligible for the exemption available to the closest family members, the tax return regarding the acquisition of assets or property rights through inheritance must be submitted to the head of the competent tax office within 1 month from the date on which the tax obligation arises.
How Can We Help?
If you have inherited assets in Poland and are wondering whether you need to settle matters with the Polish tax office, it is worth consulting a lawyer who can analyze your individual situation.
Our Law Firm supports heirs living abroad throughout the entire inheritance process, without the need for them to travel to Poland.
Seeking legal assistance minimizes the risk of negative financial consequences resulting from failure to complete tax formalities. Above all, it makes it easier to go through all required procedures — from confirming your inheritance rights, to regulating the legal status of the deceased’s assets, and finally to their division.
KBIW assist clients in court and tax proceedings, as well as in dealings with banks, property managers, real estate agents, and notaries.
