Understanding property tax in Poland is essential for both residents and foreign investors. Whether you’re purchasing an apartment in Warsaw or managing a real estate portfolio across the country, navigating tax in Poland requires insight into local, national, and international tax regimes. This article explores the Polish real estate tax system, including real property taxation, income tax implications, and capital gains rules, helping you stay compliant and make tax-efficient decisions.
What Is Property Tax in Poland?
In Poland, the term property tax generally refers to the real estate tax (RET), a local tax imposed on owners of land and buildings. This tax is separate from income tax or capital gains tax, which may apply when a property is rented or sold. The legal basis for property taxation is found in the Act on Local Taxes and Fees and applies to individuals, companies, and legal entities holding ownership of real estate or rights to such real estate.
Real Estate Tax (RET): Scope and Application
What Property Is Subject to the Tax?
The Polish real estate tax applies to:
- Land and buildings, or parts thereof
- Structures used for business activities
- Properties located in Poland, regardless of the owner’s tax residence
Taxpayers include owners, perpetual usufructuaries, and independent possessors of real property in Poland.
Important note- As of 1 January 2025, new legal definitions of “building” and “structure” came into force, clarifying and sometimes expanding what assets fall under RET—this may impact tax burdens, especially for industrial installations.
What Property Is Not Subject to the Tax?
Some properties are exempt from taxation under specific conditions, such as:
- Public roads and rail infrastructure
- Religious buildings
- Agricultural and forestry land (in certain cases)
- Properties used for diplomatic or international tax purposes
Real Estate Tax Rates in Poland
Local Tax Rates Set by Municipalities
The tax rate for real estate in Poland is determined annually by local municipalities, within limits set by the Ministry of Finance. These rates may vary significantly depending on the property’s location, type, and use. Maximum rates for 2025 are as follows:
| Property Type | Maximum RET Rate (2025) |
| Land used for business | PLN 1.38 per m² |
| Residential land | PLN 0.73 per m² |
| Buildings used for business | PLN 34.00 per m² |
| Residential buildings | PLN 1.19 per m² |
Note: Actual rates may differ across municipalities. Always verify with your local tax office.
Income Tax on Rental Property
If you earn income from renting out Polish property, that income is subject to income tax in Poland. Individuals can choose between:
- Flat-rate tax of 8.5% or 12.5% (depending on rental income thresholds), or
- General rules (progressive personal income tax) at rates of 12% and 32%, with tax deductible costs such as depreciation, maintenance, and interest expenses.
Companies renting out real estate are subject to corporate income tax (CIT) at the standard rate of 19%, or 9% for small taxpayers.
Capital Gains Tax on the Sale of Real Estate
Tax on Capital Gains
When selling real estate located in Poland, a capital gains tax may apply. For individuals:
- 19% flat tax on profits from the sale of real estate
- Applies if the property is sold within 5 years from the end of the calendar year in which it was purchased
- No tax if sold after the 5-year period or if proceeds are reinvested in another residential property
For companies, the gain is included in overall income and taxed at the standard corporate income tax rate.
Transfer Tax (PCC) and VAT on Property Sales
Tax on Civil Law Transactions (PCC)
Most sales of used real estate are subject to the 2% transfer tax (PCC), calculated on the market value of the real estate.
Value-Added Tax (VAT)
New properties or first-time sales may be subject to VAT at 8% or 23%, instead of PCC. Developers generally charge VAT, and the buyer is not liable for PCC in such cases.
| Sale Type | Applicable Tax |
| Used residential property | PCC – 2% |
| New property (from developer) | VAT – 8% or 23% |
Withholding Tax for Non-Residents
Foreigners selling property in Poland may be subject to withholding tax, depending on tax treaties between Poland and their country of residence. To avoid double taxation, the seller may need to submit tax residency certificates and file a tax return in Poland.
Minimum Tax on Revenues from Buildings
A minimum tax applies to companies owning commercial real estate (e.g., shopping centers, office buildings) with a value adopted for tax purposes exceeding PLN 10 million. This tax on revenues from buildings is:
- 0.035% monthly of the initial value adopted for tax
- Can be credited against corporate income tax due
Filing and Payment: Tax Obligations for Property Owners
How and When to Pay the Tax
- Real estate tax is typically payable in monthly or quarterly installments
- Property owners must file tax declarations with the local tax office by January 31 of each tax year. In 2025 the deadline was extended by 2 months due to the changes in the law
- Businesses must calculate and pay the tax based on their tax base, i.e., surface area or value depending on asset type.
Tax Deductibility and Relief
Some tax deductible costs associated with real estate may include:
- Depreciation,
- Loan interest,
- Repair and maintenance,
- Real estate management services.
Poland also offers limited tax relief for newly constructed buildings or energy-efficient upgrades, subject to local rules.
Real Estate Investments and Taxation in Poland
For International Investors
Foreign investors must understand both local taxes and fees and international tax obligations. Due diligence is essential when investing in real property in Poland, especially regarding:
- Tax residency
- Ownership structure (individual vs. corporate)
- Income tax purposes
- Transfer pricing regulations
A well-structured real estate investment can minimize tax liabilities and maximize after-tax returns.
Conclusion: Navigating Real Estate Taxation in Poland
Whether you’re a private buyer or an institutional investor, staying informed about property tax in Poland is critical. From income tax on rental income to capital gains tax on sales, Poland’s tax system can be complex but manageable with the right advice.
If you own or plan to invest in real estate located in Poland, make sure your tax obligations are in order to avoid penalties and optimize your returns. For complex cases, consult with a Polish tax advisor or international tax specialist.
You can find more information here https://www.podatki.gov.pl/en/stay-in-eu/taxes-of-selling-a-property/
Need help with real estate taxation in Poland? Contact our team of experts at office@intertax.pl for assistance with tax filings, investment structuring, or compliance support.