TAX CREDIT FOR INVESTMENT IN AN ALTERNATIVE INVESTMENT COMPANY – SUPPORT FOR STARTUPS, SAVINGS FOR INVESTORS
The tax credit for investment in an Alternative Investment Company (ASI) is aninnovative initiative introduced by Polish lawmakers, designed to stimulateinvestments in the capital markets in Poland. The legislation provides an opportunityfor taxpayers to deduct up to 50% of the amount invested in a venture capital fundfrom their tax base, with a maximum deduction of 250,000 PLN. This measure aimsto create more favorable investment conditions for alternative companies andstartups. Reduce the tax burden to enhance investment dynamics, and encourageinvestors to commit to entities that are in their early stages of development.
What is an Alternative Investment Company (ASI)?
An Alternative Investment Company (ASI) is an alternative investment fund, other than a specialized open- ended investment fund or a closed-ended investment fund, defined as a fund operating in accordance with EU law. It is a collective investment enterprise that raisescapital from multiple investors.
Who can benefit from the tax relief?
Individuals subject to taxation under eitherthe progressive tax scale or flat tax who invest in an ASI or a joint-stock company, inwhich the ASI holds or will hold at least 5% of the shares within 90 days from theacquisition or issuance of shares, are eligible for the deduction.
What conditions must be met to apply the tax credit?
The shareholder must bean entity whose investment has been financed with European Union funds – Allocatedparts of the European Union budget designated for the implementation of projectssupporting economic development and quality of life in EU Member States – Within themeaning of the Public Finance Act. Additionally, the taxpayer must enter into aninvestment agreement that outlines the rights and obligations of both the investor andthe company. Another requirement is that the investor must not be a related entity fora period of two years. The final condition is that the taxpayer must hold the sharesfor a minimum of 24 months.
In conclusion, these new investment opportunities serve as a means to stimulate economic growth and foster development. Through this tax credit, Polish lawmakers seek to demonstrate their commitment to increasing interest in capital markets. However, it is essential to recognize that several requirements and conditions must be met in order to benefit from this tax incentive.
