Ukraine’s support through donations in context with income taxes
An amendment to the Act on Income Taxes is prepared to support voluntary donations aimed at helping Ukraine, which will take effect retroactively from the beginning of 2022. In accordance with the amended rules, it will therefore be possible to claim even donations made before the amendment comes into force. In this way, donations sent to the account of Ukraine’s embassy as well as donations made in support of the defense efforts of the state of Ukraine, such as the donation of military materials, will now be tax-deductible. Concurrently, the limit for deducting gifts and donations is increased to 30% of the tax base for the tax period 2022 for natural persons, or for the tax periods ending from 1 March 2022 to 28 February 2023 for legal entities (the current limit is 15% of the tax base for natural persons and 10% for legal entities).
The financial donations provided by the employer to his employee in order to help in a difficult life situation raised in connection with the conflict in Ukraine are also newly exempted. Such a donation will not be now considered as employer’s social assistance, but as a tax-free gratuitous benefit for humanitarian or charitable reasons.
An overview of all proposed changes is available here.