Foreign trusts in Polish inheritance law

Last updated: 04.12.2025 

Foreign trusts in Polish inheritance law – recognition, effects and beneficiary status

With the growing number of international inheritance cases, the question of how to treat foreign trusts – especially those established by will – in the Polish legal system is becoming increasingly common.

Trusts, as an institution characteristic of common law systems (e.g. the UK, USA, Canada or Australia), have no equivalent in Polish civil law.

Despite this, Polish courts and tax authorities are increasingly confronted with attempts to recognize the effects of trusts on inheritance, inheritance or taxation of the beneficiaries’ acquisition of property.

What is a trust?

A trust is a legal structure in which a founder (settlor) transfers property to a trustee (trustee) to manage it for the benefit of designated beneficiaries.

The trustee formally becomes the owner of the transferred property, but his duty is to act in accordance with the interests of the beneficiaries. This kind of separation of ownership title (into formal and economic) is typical of common law jurisdictions, but completely alien to the Polish legal system, where ownership is treated as a unified and indivisible category.

Trust and Polish law

Poland is not a party to the Hague Convention on the Law Applicable to Trusts, which means that the institution of a trust is not automatically recognized. A trust can be recognized only to the extent that its effects can be translated into well-known institutions of Polish law, such as a legacy, a donation agreement or a trust.

In practice, most of the controversy concerns trusts established by will (so-called testamentary trusts), which are intended to transfer assets after the founder’s death.

The beneficiary of the trust as a legatee or as an heir

In the case of testamentary trusts, when the document clearly identifies a specific person as the beneficiary and assigns a specific asset to him, it is possible for a court to recognize such a person as a legatee. Then the provisions of a testamentary bequest – both ordinary and testamentary legacies – may apply.

However, if the trustee is given the entire estate, they acquire the same rights as an heir and become entitled to the estate’s assets.

Such qualification allows the beneficiary, among other things, to take advantage of tax exemptions available to the immediate family. Problems arise when the beneficiary is not named, when the trust does not precisely specify the subject of the transfer, or when the final decision is at the trustee’s discretion. In such cases, the courts may not recognize the beneficiary as a legatee or heir, and may consider the entire property covered by the trust as part of the estate subject to distribution to the heirs.

Tax implications

On inheritance and gift tax grounds, tax authorities often treat beneficiaries of testamentary trusts as legatees, which opens the way for the application of the exemption for relatives.

In the case of life trusts (inter vivos), benefits paid by the trustee may be considered a gift from a third party and subject to taxation under the general rules. Attention is also drawn to the possibility of delaying the moment of tax liability until the actual payment of the benefit. If the funder and trustee are the same person, the structure may be challenged by tax authorities as artificial and tax-avoiding.

Recommendations for succession planning with trusts

Individuals planning a succession using a trust – especially if they have a connection to Poland (citizenship, residency, assets, heirs) – should exercise extreme caution. It is recommended to:

• establish the trust in the form of a will and ensure that it meets the formal requirements recognized by Polish law,
• identify the beneficiaries by name and precisely define the transferred property,
• consult a tax advisor and an inheritance lawyer in Poland to understand the potential legal and fiscal implications for the beneficiaries,
• consider drafting a parallel will that complies with Polish law, as a supplement to foreign structures.

Can a foreigner make a will in Poland in addition to a trust?

Yes, a foreign citizen can, in addition to a trust, draw up a will in Poland, provided that he meets the general requirements under Polish law. This means that he must have full legal capacity, the will must be drawn up in one of the permitted forms (e.g., handwritten, notarized).

There is no requirement that the foreigner have a permanent residence in Poland – it is sufficient that the will be drawn up on its territory in accordance with Polish regulations. Under EU Regulation No. 650/2012, which is in effect in most countries of the European Union (including Poland), a person making a will may independently choose the inheritance law of his or her country of citizenship instead of the law of the country in which he or she resides.

Importantly, a will drawn up in Poland may be considered valid in another country, but this depends on several factors, such as international regulations, the inheritance law of the country in question and the form of the will.

Which document is decisive – a will or a trust?

In the Polish legal system, the basic form of disposing of property in the event of death is the will. If the will was drawn up in accordance with the requirements of the law (including, for example, the applicable law chosen by the testator), its provisions will be crucial in assessing who and what inherits.

A foreign trust – especially if it was established in a will – can be treated as a means of executing the testator’s will, and its effectiveness will be evaluated in the context of the totality of the testator’s dispositions and their compliance with the Polish legal order.

In practice, this means that if there is both a will and a trust, the court will analyze:

• whether the will was drafted in accordance with the law and contains a valid choice of applicable law (e.g., native law),
• whether the content of the trust is consistent with the provisions of the will and whether it can be translated into institutions known in Polish law (e.g., bequest, order),
• whether any of the dispositions do not violate mandatory provisions,
• What was the actual will of the testator and to what extent it can be respected.

What if there are contradictions?

If the provisions of the trust and the will are inconsistent or contradictory, the court does not apply the automatic principle of “priority,” but examines which will was last, valid and lawful.

Usually, however, the will – as a classic form of death disposition – is the starting point for interpretation, and the provisions of the trust can be recognized only to the extent that they are consistent with the will and the provisions of Polish law.

In particular, a trust may be disregarded or limited in its effect if:

• hinders the identification of assets,
• or leads to solutions contrary to the principles of Polish public policy.

Summary

Although a trust does not function as a legal institution in Polish civil law, it can have legal effects in Poland if it is properly planned and embedded within a will. Otherwise, there is a risk that it will be disregarded in inheritance proceedings, and the property will go to heirs determined according to the rules of statutory inheritance. To avoid disputes and additional taxation, it is crucial to integrate common law solutions with the realities of the Polish legal system.

FAQ – Foreign Trusts and Polish Inheritance Law