Property-Related Taxes in Poland

Non-residents are taxed in Poland only on income derived from Polish sources. Married couples are taxed separately.

Personal income tax is progressive, with rates of 12% and 32%. Private rental income is no longer taxed under the progressive system and is subject instead to lump-sum taxation at rates of 8.5% or 12.5%, depending on annual rental revenue. Capital gains from the sale of real estate are exempt if the property has been held for at least five years. 

Corporate income is generally taxed at 19%, with a reduced 9% rate available for qualifying small taxpayers. Property transaction costs in Poland are relatively low, with roundtrip costs typically between 5% and 6%. VAT applies to certain real estate transactions, although residential leases are generally VAT-exempt.

Annual Property Tax

In Poland, annual property tax (called podatek od nieruchomości or Real Estate Tax – RET) is generally quite low compared with many other countries, and is not based on the market value of the property — but on size (area) and use

Income Tax

Taxable income is generally calculated by deducting allowable income-generating expenses from gross income. Taxable income from all sources is then aggregated and taxed at progressive personal income tax rates.

Income Tax Rates 2026:

Rental Income Tax

In 2026, private rental income may only be taxed under the lump-sum taxation regime. The applicable rates are 8.5% on annual rental revenue up to PLN 100,000 (€23,202) and 12.5% on any rental revenue exceeding PLN 100,000. Under this regime, tax is levied on gross rental revenue, and expenses are not deductible.

Corporate Taxation in Poland

Income and capital gains earned by companies are subject to corporate income tax at a standard rate of 19%. Expenses incurred in the production of taxable income are generally deductible.

A reduced corporate income tax rate of 9% may apply to income other than capital gains if the taxpayer qualifies as a small taxpayer. This applies where annual sales revenue, including VAT, did not exceed the PLN equivalent of €2 million in the previous fiscal year, or where the company is in its first year of activity, provided it was not established as a result of a merger or transformation.

Value Added Tax (VAT)

VAT in Poland is generally levied at a standard rate of 23%. A reduced rate of 8% may apply to certain real estate transactions.

The lease of immovable property for residential accommodation purposes is VAT-exempt, provided the property is not leased for business use. 

Sales of land and buildings are generally subject to VAT at 23%. A reduced VAT rate of 8% may apply where residential premises do not exceed 150 square meters.

Capital Gains Tax

Capital gains derived from the sale of real estate are exempt from tax if the individual has owned the property for at least five years prior to the sale.

If the property is sold within five years of acquisition, capital gains are taxed at a flat rate of 19%. The acquisition cost and transaction-related expenses are deductible when calculating the taxable gain. 

Special transitional rules apply to residential properties acquired before 1 January 2007. In such cases, a flat tax rate of 10% is applied to the sales proceeds, reduced by eligible transaction costs.

Value Added Tax (VAT)

VAT is generally levied at a flat rate of 23%. A preferential rate of 8% may apply in some transactions.

The lease of immovable property for the purpose of accommodation (not for business purposes) is VAT-exempt.

Land sales and building sales are generally subject to 23% VAT. The preferential rate of 8% may apply if the residential premises do not exceed 150 square meters.

Property Buying Costs and Transaction Taxes in Poland