In brief

• Benefits provided by an employer to an employee are not always income from employment.
• In some cases they may be treated as a gift, which changes the tax consequences.
• An example is a jubilee gift, and the classification depends on the assessment of the specific factual situation.

When a benefit is income

The National Revenue Information (Krajowa Informacja Skarbowa) is increasingly receiving applications concerning gifts handed to employees and their tax consequences (Nie każde świadczenie na rzecz pracownika to przychód. Czasami to może być darowizna. W jakich sytuacjach? – GazetaPrawna.pl). The rule is that anything an employee receives from the company in connection with employment may be treated as income and subject to personal income tax (PIT). The question is therefore whether the handover is related to work or not.

A gift instead of income

Not every benefit for an employee is income. In some situations it may be classified as a gift, which changes the tax consequences. It is worth considering not only PIT but also the tax on inheritances and gifts.

A jubilee gift as an example

One example discussed in the materials is a jubilee gift. It describes an individual interpretation issued in such a case, where the starting point was a limited liability company planning to give an employee such a present. Documents issued by tax authorities show that each case requires a separate assessment of the factual situation, and simply calling a benefit a gift does not settle the matter.

What it means for a company

Entrepreneurs planning to give gifts to employees should first check whether the benefit will be income or a gift. This depends on the circumstances of the transfer and on its connection with work.