Gift from mother paid into mortgage account still qualifies for full tax exemption, court rules

A mother’s gift to her daughter does not lose its tax-exempt status simply because the money went directly into a technical account used to repay a mortgage, Poland’s Supreme Administrative Court has ruled.

The case concerned a woman who received nearly 100,000 zlotys from her mother on January 30, 2024. The transfer description identified it as a gift from mother to daughter for repayment of a mortgage and housing loan. The money went to a bank account linked to the debt.

The daughter explained that she co-owned the technical account, but that it could accept only payments toward the loan and could not be used for ordinary deposits or withdrawals. She sought confirmation that the transfer properly documented receipt of the gift and qualified for the full exemption available to Poland’s closest family group.

Tax officials refused. They argued that a cash gift must be documented as transferred to the recipient’s payment account, another eligible bank account or cooperative savings and credit union account, or by postal order. In their view, the mortgage repayment account was merely a place where the bank recorded repayment and did not belong to the taxpayer.

The woman challenged the decision and won first at the Provincial Administrative Court in Gliwice. The court referred to case law allowing the exemption when money goes to a bank account other than the recipient’s, but is paid on the recipient’s behalf, such as an account held by a developer. The Supreme Administrative Court has now maintained that taxpayer-friendly approach.