Taxation of real estate transactions in Poland is no different from taxation of other profits, both for individuals and for corporations.
Understanding Tax Implications: Profits and Transaction Tax
For individuals, the tax on profit from the sale of real estate is levied at a fixed rate of 19%. Conversely, when a company sells a property, the profit is combined with the company’s overall income, and corporate tax is applied at the standard rate of either 19% or 9%, depending on the scope of the company’s earnings.
In addition to the profit tax, a “transaction tax” is payable by the real estate buyer, amounting to 2% of the sale price. However, if the transaction is subject to VAT, an exemption from the transaction tax is granted.
VAT is applicable to real estate transactions, primarily at a rate of 23%, except for residential apartments, which are taxed at 8%.
When considering the purchase of real estate in Poland, it is crucial to take into account the implications of taxation. The subject of VAT on real estate transactions can be complex, which is why our clients benefit from the dedicated support and guidance provided by our experienced team at the firm.
For a more in-depth understanding of VAT on real estate transactions, we invite you to explore further and access comprehensive information regarding this aspect. Understanding the intricacies of tax law and property tax is vital to making informed decisions throughout your real estate endeavors.