From the beginning of the tax system in Poland, private individuals obtaining income from private lease, like sole proprietorships, could choose the form of taxation between a simpler lump sum on recorded income and PIT on general terms. The New Tax Order removes this choice: rental income will be removed from the PIT Act, and the recipients of it will be covered only by the provisions of the Lump-sum Tax Act. Taxpayers who invested money in renting, buying flats for this purpose or renovating old premises to adapt them to the rental market standard, will lose. Tax according to the tax scale will be payable only if it is known for income from business activity.
On October 1, 2021, the Sejm passed an act regulating the tax part of the New Deal program. Some of the changes – their nature is revolutionary – fundamentally change the rules of taxation of rental income obtained by natural persons.
One important amendment has been made to the project: taxpayers with revenues from private rental will be able to depreciate buildings and residential premises – acquired or constructed by the end of 2021 – for another year, i.e. until the end of 2022.
We will inform you about detailed solutions when the act is adopted by the Senate and completes the entire legislative cycle, because further changes cannot be ruled out. If the Senate proposes them, the Sejm will have to vote on them again.
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According to the provisions of the project, the owners of flats and premises earning money on rent will not be the beneficiaries of the greatest benefits of the Polish Deal, because next year they will have to pay a lump sum. Aleksandra Kalinowska, tax advisor, Partner at Andersen Tax & Legal explains – The provisions presented in the Polish Deal project indicate that from next year, the settlement of rent and lease will be possible only through a lump sum on recorded revenues, which in turn will prevent the use of the radically increased tax-free amount.
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