Poland: Income tax on buildings: Amendments
International Tax Review is part of Legal Benchmarking Limited, 4 Bouverie Street, London, EC4Y 8AX
Copyright © Legal Benchmarking Limited and its affiliated companies 2024

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Poland: Income tax on buildings: Amendments

Sponsored by

sponsored-firms-mddp.png
intl-updates-small.jpg

The new rules concerning income tax on building regulations will enter into force on January 1 2019, with some relating to 2018.

The main amendment is that income tax on buildings will apply to all buildings owned (wholly or partially) for rent or other forms of payable use, excluding only residential properties included in governmental or local social housing programmes. The tax will continue to apply to all buildings that are fixed assets regardless of statistical classification, including warehouses, production facilities, offices and shopping centres. Income tax on buildings will be due if the rented area exceeds 5% of a building's total usage area. The tax does not apply to buildings used mainly for an entity's own needs.

The tax base will be the sum of initial tax values of buildings less than PLN 10 million ($2.7 million). The tax will apply to all buildings belonging to a given taxpayer, regardless of quantity and value (in 2018 a PLN 10 million tax allowance applied to each individual building). Regarding related parties, the PLN 10 million is divided proportionally according to the income from a given taxpayer's buildings to the income of the group.

In situations when the amount of corporate income tax is lower than tax on buildings or a taxpayer declares a tax loss, the income tax on buildings will be refunded if the tax authorities conclude that there were no irregularities in the settlement of this tax and the correct settlement of income tax (especially relating to debt financing costs) was made. The refund is made on the request of the taxpayer only. This provision has been introduced with retrospective effect from January 1 2018.

The new regulations introduce the targeted anti-avoidance rule (TAAR), whereby the tax is also applicable if the taxpayer transfers ownership of the building or provides it for use under a leasing contract to avoid income tax on buildings (unless doing so is justified for economic reasons).

Neither the 0.42% per annum tax rate nor the right to deduct income tax on buildings from monthly income tax advances were changed.

more across site & bottom lb ros

More from across our site

As German clients attempt to comply with complex cross-border rules, local advisers argue that aggressive tax authorities are making life even harder
Based on surveys covering more than 25,000 in-house lawyers, the series provides insights into what law firms must score highly on when pitching to in-house counsel
The UK tax authority reportedly lost a case due to missing a deadline; in other news, Canada has approved pillar two legislation
There will always be multinationals trying to minimise tax by pushing the boundaries of their cross-border arrangements, Rob Heferen claimed
HMRC’s attempts to crack down on fraudulent tax relief claims are well-meaning, but the agency risks penalising genuinely innovative businesses, writes Katy Long of ForrestBrown
Argentina, Brazil, Mexico and South Africa are among the countries the OECD believes could benefit from the simplified TP rules
It comes despite an offshore enabler penalty existing in the UK throughout the entire period
It is extraordinary that tax advisers in the UK can offer their services without having to join a professional body. This looks like it is coming to an end, Ralph Cunningham writes
Meet the esteemed judges who are assessing the first-ever Social Impact Awards
The ‘big four’ firm has also vowed to spend more on nurturing junior talent; in other news, Blick Rothenberg has hired a pair of tax partners
Gift this article