To protect our loved ones in the event of our death, the legislature has provided several solutions. We can establish a family foundation to provide financial resources for designated beneficiaries, or write a will. We don't always realize that we can also submit a death benefit directive to the bank where we hold an account.
A will is less popular than, for example, a will. This is likely because banks inform us of this option when opening an account, and if we don't decide to do so immediately, we often forget about it. This solution is advantageous because, unlike a will, the person authorized to take over the funds in the bank account can do so immediately after the account holder's death. Therefore, they don't have to wait for a court decision to establish the inheritance or visit a notary to obtain a certificate of inheritance. Furthermore, funds covered by a will are not part of the estate. This means that if the person authorized under the will is also an heir, the money received from the bank does not reduce their share of the estate.
Such an instruction may be submitted by holders of a savings account, checking account, or term deposit account. Regardless of the number of instructions submitted, the withdrawal amount cannot exceed twenty times the average monthly salary in the corporate sector, excluding profit-sharing bonuses, as announced by the President of the Central Statistical Office for the last month before the account holder's death. In November 2023, the withdrawal cannot exceed PLN 150,892.80.
Being entitled to funds, we may unknowingly expose ourselves to the obligation to pay tax. Authorized individuals may include a spouse, ascendant, descendant, or sibling – individuals who, if they submit a timely declaration to the head of the tax office, are exempt from inheritance and gift tax. Because funds designated as assets in the event of death are not part of the estate, the Inheritance and Gift Tax Act determines when the tax liability arises at a different point.
In the case of inheritance, the tax liability arises upon acceptance of the inheritance (court confirmation of inheritance acquisition or notarial certification of inheritance). However, the inheritance case can also be filed several years after the testator's death. However, in the case of acquisition of rights to contributions covered by the death benefit arrangement, the tax liability arises upon the death of the account holder (contributor). Therefore, the acquisition must be reported within six months of death. Failure to submit the report on time will result in the payment of tax at the appropriate rate for tax bracket I.
The Act does allow for effective notification even after the statutory deadline. However, the acquisition must then be reported within six months of receiving information about the acquisition. Furthermore, the fact that the information about the acquisition was received later must also be substantiated. The substantiation is subject to review by the tax office, which may result in the acquisition not being deemed substantiated. This will result in the payment of tax.
This article is for informational purposes only and does not constitute legal advice.
Legal status as of November 27, 2023
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