When purchasing a new real estate development, such as an off-plan flat, in Poland, the applicable taxes differ depending on whether you are an individual or a limited company. This is an overview:
VAT
– Individuals: The tax rate is usually 23% of the property value for residential flats in a new development.
– Limited companies pay the same tax rate as individuals: 23% of the property value for residential flats in a new development.
Tax on Rental Income (PIT – Podatek Dochodowy od osób fizycznych)
– Individuals: The rental revenue from the property is liable to personal income tax. The tax rate varies according to the individual’s overall income level, but for rental income their is a favourable tax rate of 8,5% on the net rental income.
– Limited Companies: A limited company’s rental income is subject to a flat 19% corporate income tax (CIT).
Capital Gains Tax (PCC – Profit from Commercial Activities)
– Individuals: Capital gains from the sale of property are taxed as personal income. If the property has been owned for less than five years, the tax rate is 19 percent. If the property has been owned for more than five years, capital gains are exempted from taxes.
– Limited Companies: A limited company’s capital gains are subject to a flat 19% corporate income tax (CIT).
It’s crucial to remember that tax rates and rules might vary over time, so for the most up-to-date information and individualized guidance, speak with a tax advisor or legal expert who is familiar with Polish tax laws. We are here to assist you.
