Conditions established for financial assets

The conditions established for financial assets are provided for in § 171 of the Income Tax Act:

(2) The following are considered financial assets:
1) securities which are publicly offered in a Contracting State or a member state of the Organisation for Economic Cooperation and Development for the purposes of the Securities Market Act or the legislation of a respective foreign state;
2) securities which are admitted for trading on a regulated securities market or multilateral trading facility of a state specified in clause 1) (hereinafter market) or concerning which a request has been submitted for admission for trading on such market on the condition that financial supervision is exercised over such market and this market is recognized by such state and operates regularly, and on which the public can acquire or transfer securities;
3) shares or units of investment funds not covered by clauses 1) and 2) for the purposes of the Investment Funds Act or shares or units of such investment funds established in a foreign state specified in clause 1) which are subject to financial supervision;
4) deposits opened with a credit institution which is a resident of a state specified in clause 1) or in the permanent establishment of a credit institution located in the above state;
5) unit linked life assurance contracts entered into as of 1 August 2010 which underlying assets are financial assets specified in clauses 1)–4) and clause (3) 1) and which were entered into with an insurer of a state specified in clause 1);
6) derivative instruments not covered by clauses 1) and 2), the party to which is a management company, investment firm or credit institution which is a resident of a state specified in clause 1) and which underlying assets are financial assets specified in clauses 2)–4);
7) short-term debt securities not covered by clauses 1) and 2) if the debt security is liquid and its value can be accurately determined at any time, and it was issued by a resident of a state specified in clause 1), which meets the requirements provided for in clauses 107 (2) 1)–4) of the Investment Funds Act.

(3) Financial assets also include shares or units of investment funds of a state not specified in clause (2) 1) and securities admitted for trading on the market of such state on the condition that:
1) financial supervision is exercised over such investment fund, management company or market;
2) a taxpayer concludes a transaction involving the financial assets in the framework of the provision of investment services specified in § 43 of the Securities Market Act with a credit institution, investment firm or management company which is a resident of a state specified in clause (2) 1).

(4) Contributions made also after the entry into a deposit or insurance contract on the basis thereof are considered acquisition of financial assets.

(5) Financial assets at the time of acquisition shall meet the requirements provided for in subsection (2) or (3).

(6) The provisions concerning financial assets are also applied to assets which were acquired as financial assets, but which at the time of transfer of these assets, receiving income on these or at the time of the termination of the contract do not meet the requirements established for financial assets in § 171 of the Income Tax Act.

(7) Financial assets do not include insurance contracts for a funded pension and units of pension funds (§§ 28 and 281).
 

02.03.2018