In a judgment handed down on March 16, 2016 (case file no. I SA/Gl 1220/15), the Provincial Administrative Court in Gliwice held that a positive value of goodwill earned as a result of the sale of an enterprise [Polish: przedsiębiorstwo] is a property right and, for this reason, just like any other assets, it is subject to the tax on civil law transactions (PCC) levied on the purchase agreement.

The taxpayer involved in the case argued that goodwill was merely a specialist term (used in balance sheets and tax parlance) and did not amount per se to a property right, because it apparently did not have features characteristic of property rights, in that it could not independently constitute a subject matter of a legal transaction or a civil law dispute between parties to the legal transaction. Consequently, the goodwill assessed for accounting and/or CIT purposes should not be subject to PCC, as it does not constitute a property right expressly listed in the applicable statutory regulations as one subject to PCC. The court did not agree with the taxpayer’s argumentation and dismissed his appeal. When orally providing the statement of grounds for the judgment, the court stressed that positive goodwill has the nature of a property right, because it constitutes a quantifiable value, is inextricably attached to the enterprise and can be disposed of as a constituent part of the enterprise. Moreover, goodwill becomes quantifiable only if and when a prospective purchaser is able to assess its value. According to the court, positive goodwill is an asset value on intangible rights. By the same token, in the court’s estimation, assessment of the tax base should not be a problem and the difference between the value of individual assets of the enterprise listed in the purchase agreement and the price charged by the seller will become the tax base for PCC taxation.


The tax base for PCC purposes in the case of sale of an enterprise has been a notoriously controversial problem. One of the most essential issues is whether or not to include goodwill in the tax base, considering that goodwill is neither a thing nor a property right (in terms of civil law) but an accounting and tax term denoting the difference between the purchase price of the enterprise and the net fair value of all assets purchased, where the latter is lower than the former. Despite worthy arguments cited to support the thesis that no PCC will apply to positive goodwill, in the present case the court chose a pro-fiscal interpretation of the PCC Act, thereby following in the footsteps of other administrative courts in similar cases. Hopefully, in the written statement of grounds the court will provide exhaustive argumentation on why it decided to treat goodwill as a property right, unlike previous judgments in similar cases. Notwithstanding the foregoing, a taxpayer intending to purchase an enterprise or an organized part of an enterprise must factor in the risk of having to pay PCC on goodwill or carefully structure the transaction so as to minimize its tax exposure.