The family foundation has been with us for a year now
The Family Foundation Act came into force on 22 May 2023. It introduced a completely new legal institution into the Polish legal system, opening up new opportunities for family businesses and multi-generational wealth transfer.
The number of foundations is slowly but surely growing. The advantages of this formula are being recognised.
What are the main benefits of establishing a family foundation?
Protection of family assets: The foundation becomes the owner of the assets, protecting them from fragmentation and ensuring their stability in future generations.
Facilitated transfer of the company: A foundation can be the ideal instrument for handing over the business to successors, ensuring a smooth succession and minimising the risk of family conflicts.
Ability to attract EU funding: Family foundations can apply for EU funds for business development, giving them additional opportunities for growth.
Tax benefits: The law provides tax relief for family foundations, making them an attractive form of business.
One year of operation of the Family Foundation Act shows that this was a step in the right direction. It can be expected that in the following years this legal form will gain in popularity, becoming an important element of the Polish business landscape.
It is also worth mentioning the challenges to the operation of family foundations. One of them is the need to develop clear rules for the functioning of the foundation and management of its assets. It is also important to ensure transparency and reliable supervision of the foundations’ activities.
Despite these challenges, family foundations appear to be a promising legal form which may play an important role in the development of Polish family businesses.
If you are considering setting up a family foundation – feel free to contact us.