Free internships are not free benefits


Unpaid graduate internships are a relatively frequently used form of employment. They can accept people who have completed at least lower secondary school and who are not more than 30 years of age. However, will the unpaid work of the apprentice constitute income for the taxpayer from free benefits?

As a rule, the concept of revenue is defined - in accordance with Art. 11 sec. 1 of the PIT Act - money and cash values ​​received or left at the disposal of the taxpayer in the calendar year as well as the value of received benefits in kind and other free benefits. However, according to Art. 9 sec. 1, income tax is subject to all types of income, with the exception of income excluded from this obligation in accordance with art. 21, 52, 52a and 52c of the Act and income that is not taxed in accordance with the provisions of the Tax Code.

It may therefore seem that the income generated by employing a graduate for unpaid internships will be taxable. Not completely. According to the opinion of the tax authorities, a free service is considered to be an action of the service provider that is related to his good will, expressed by providing a free service.

However, a free-of-charge benefit will not be an equivalent benefit - that is, one for which the parties do not receive a monetary payment, but receive benefits of a similar extent. In the case of apprenticeships, we are dealing with just such a benefit - the apprentice gains professional experience and skills that will be useful to him on the labor market, while the employer obtains a real workforce.

Thus, a graduate internship does not constitute a free benefit in the light of tax law. This is also confirmed by the positions of the tax authorities, e.g. the individual ruling issued by the Director of the Tax Chamber in Poznań on June 29, 2011 (ILPB2 / 2415 + 436 / 11-2 / WS).