As of 1 January 2025, amended property tax regulations will take effect in Poland. The changes may significantly impact owners of commercial properties, including foreign investors. Among the key amendments are new definitions of buildings and structures, which could lead to the reclassification of certain properties and result in higher tax rates.
The amended legislation aims to address challenges in effective property tax enforcement. Foreign investors are advised to carefully analyze their properties in light of the new rules to evaluate potential changes in their tax burdens. Experts recommend conducting property audits to determine the specific tax changes applicable to each property. These audits will also help account for associated costs in budget planning for the upcoming year.
Preparatory Steps for Entrepreneurs
Before submitting their declarations, entrepreneurs should ensure all their properties are thoroughly identified and inventoried. At first glance, this may appear to be another standard property tax return. However, compliance with the new tax conditions will require:
- Determining the actual condition of the assets.
- Verifying registration data against the actual state of the properties.
- Classifying and valuing the properties for tax declarations under the updated regulations.
Szymon Mojzesowicz (MRICS, ASA) from the Polish consulting firm Lege Advisors emphasizes the importance of these steps:
“Taking shortcuts and unthinkingly rewriting last year’s declaration can lead to serious problems, from accruing interest on tax arrears to having the declaration recognized as a fiscal offense.”
Increased Scrutiny and External Support
The implementation of the new regulations will likely be closely monitored by tax authorities. Experts predict that many businesses, especially medium-sized and large industrial plants, will require the assistance of external companies specializing in asset valuation to navigate the changes.
The amended act introduces numerous changes, including refined definitions of taxable facilities. Particular attention should be paid to the appendix of the Act, which lists taxable structures.
Practical Implications and Deadlines
Entrepreneurs must analyze the new regulations, conduct audits, and prepare updated documentation. This process may necessitate training existing staff responsible for preparing declarations or hiring new personnel. Szymon Mojzesowicz highlights the challenge:
“Will there be enough time to complete all these steps and submit the declaration on time?”
Recognizing these challenges, the legislator has introduced provisions allowing, under certain conditions, an extended deadline for filing declarations until 31 March 2025. To utilize this extension, taxpayers must submit a notice and pay the property tax for the first months of 2025 based on the monthly average for 2024.
Despite this extension, the question remains whether businesses will find this timeframe sufficient to adapt to the sweeping changes in property tax regulations.