Can a donation to the foundation be tax deductible?

Donations to foundations and tax relief

According to the Act, a taxpayer who made a donation in the tax year may deduct the appropriate amount from tax if the entity receiving the donation was/was:

1. A non-governmental organization (e.g. foundation and association) that is not a unit of the public finance sector and does not operate for profit and, among others, churches, associations of local government units and social cooperatives;

2. equivalent organizations specified in the provisions regulating public benefit activities in force in a European Union (EU) Member State other than Poland or another country belonging to the European Economic Area (EEA, Iceland, Liechtenstein, Norway), which conduct public benefit activities in the sphere of public tasks and achieve the indicated goals.

3. An entity operating for the benefit of religious worship, blood donation, vocational education, and the donation concerned the fulfillment of the objectives specified in the provisions of the Act on public benefit activities and volunteering (e.g. to support families and people in difficult life situations, for charity activities and for people disabled, for health protection and promotion or for science, higher education and education).

Conditions for tax deduction of donations

Such a transfer of funds may be tax deductible in the entire amount, but not more than 6% of the income.

Donations to foundations without OPP status and tax relief

Based on general regulations, the Director of the National Fiscal Information was asked whether a donation made to a foundation that does not have the status of a public order organization can be deducted from tax. In the facts of the case, it was emphasized that the entity’s statutory goal was to conduct activities in the field of science, education, and upbringing, and the foundation’s management board confirmed in writing that the donated funds were available to achieve only these goals.

The Director of KIS agreed with the applicant’s claim and confirmed that the taxpayer may deduct the amount of a cash donation made to the foundation from the basis for calculating income tax in accordance with the principles set out in Art. 26 section 1 point 9 of the Personal Income Tax Act.

The tax authority explains that in accordance with Art. 4 of the Act on public benefit activities and volunteering – the goals indicated in the application – are considered public benefit goals. Additionally, the foundation meets other conditions for deduction.

Summary of KIS interpretation

To sum up, the Director of the National Tax Information presented the position that a Foundation that does not have the status of a “public benefit organization” in accordance with the Act on public benefit activities and volunteering, but pursues statutory objectives defined as conducting activities in the field of science, education, education and upbringing may be beneficiary of a donation that may be deducted from the donor’s tax.

Individual interpretation of November 14, 2023, Director of the National Tax Information, ref. no. 0113-KDIPT2-2.4011.648.2023.1.DA