Legislator Case Law & Legislation
III RN 31/99 AI generated

Company using partners' pure profit without payment constitutes taxable non-paid benefit under tax law.

Case Number III RN 31/99
Court / Authority
Jurisdiction Poland (PL)
Decision Date
Outcome Allowed / Granted

Legislator summary

AI generated

The Supreme Court allowed the taxpayer's extraordinary revision against the tax authority's decision to deny tax on a company's use of partners' pure profit. The lower courts had ruled that the profit distribution resolution was invalid and that using the capital was taxable income, but the Supreme Court overturned this reasoning. The court held that the company received a non-paid benefit by gaining the right to dispose of funds without paying interest, which constitutes taxable income under the Income Tax Act.

Legislator headnote

AI generated

Art. 12 ust. 1 pkt 2 ustawy o podatku dochodowym od osób prawnych; Art. 191 KH: A company utilizing partners' pure profit without payment constitutes a non-paid benefit taxable as income, valued at the interest the company would have to pay to acquire such capital on the market.

Keywords

AI generated
non-paid benefit pure profit Income Tax Act taxable income partnership resolution extraordinary revision capital utilization

Cited Legislation

AI generated
Art. 12 ust. 1 pkt 2 of the Income Tax Act for Legal Entities
Art. 191 of the Commercial Code
Art. 7 ust. 1 of the Income Tax Act for Legal Entities
Art. 393 of the Code of Civil Procedure
Art. 27 ust. 1 of the Act on the Supreme Administrative Court
Art. 10 of the Act on Amendments to the Code of Civil Procedure
Art. 236 ust. 2 of the Constitution of the Republic of Poland
art. 236 ust. 2 Konstytucji

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