Along with income from labor and entrepreneurial activities, in ordinary life there is income from the sale of a car, real estate, from donations, that is, in accordance with various civil law agreements. These incomes require appropriate taxation and reporting, that is, the filing of PCC declarations (podatek od czynności cywilnoprawnych). More on this further in this article.

One of the types of income of individuals is the income received from civil law contracts. Detailed information on the taxation of such income is available on the government website podatki.gov.pl.

The tax liability for income tax from civil law transactions arises from the following agreements (or their change with an increase in the tax base):

• a contract for the sale and exchange of goods or property rights,
• money loan agreement,
• donation agreement,
• rent agreement,
• agreement on the division of inheritance,
• mortgage agreement,
• court decision, settlement agreement and others.

If the contract is concluded in the form of a notarial deed before a notary, personal income tax is paid to the notary. Contracts for the sale of real estate (apartments, houses, land) must be signed by a notary.

The taxpayer of income from civil law contracts is the person who acts as the beneficiary (owner) of this contract.

The tax base depends on the type of contract. As a rule, it reflects the market value of the subject of civil law contracts. The tax is always paid on the market value of the subject of the contract, even if the contract itself contains a different price.

The tax authority has the right, within 5 years after the end of the year in which the tax payment deadline expires, to require the taxpayer to determine, increase or decrease the value of the subject of activity within a period of at least 14 days from the date of delivery of the request, if it establishes that the taxpayer did not indicate the value or it does not match the market value.

The tax rate depends on the type of contract. For example, for contracts:

• sale, exchange, life annuity, inheritance, donation – 2% of the taxable base,
• for property rights – 1% of the tax base.

Each type of civil law contracts has its own income tax rates.

The following are exempt from tax:

• representatives of foreign states, consular offices and armed forces, international organizations and institutions - subject to reciprocity,
• persons with disabilities who purchase rehabilitation equipment,
• public benefit organizations,
• local self-government bodies and other state organizations.

Tax exemptions include income from sales, for example:

• foreign currency or cryptocurrency,
• treasury bills and bonds,
• movable property, if the tax base does not exceed PLN 1,000,
• property rights, which are financial instruments produced by investment companies in the framework of organized trading.

When receiving income from civil law contracts, individuals submit the following tax returns and their annexes PCC-2, PCC-3, PCC-3/A, PCC-4, PCC-4/A, PCC-4/B. Declaration forms are available on the website in online and printed forms. It is necessary to take into account the deadlines for filing declarations: the PCC-3 declaration with attachments is submitted within 14 days from the date of the tax liability; the PCC-4 declaration with attachments is submitted by the 7th day of the month following the month in which the tax liability took place.

Tax payment date. When filing a PCC-3 return, the tax must be paid within 14 days from the date of the tax liability. When filing a PCC-4 return, tax must be paid by the 7th day of the month following the month in which the tax liability took place.

Tax on income from civil law transactions is refundable if, for example, the legal consequences of the contract have been canceled or the condition preceding the performance of the contract has not been fulfilled, and in other established cases. The tax is not refundable 5 years after the end of the year in which it was paid.