Kinga Baran, Partner and Head of Tax Advisory Services at Forvis Mazars Polska, talked to Property Forum about the tax environment in the Polish property market, ESG awareness among her clients and the development plans for coming months.
One of the biggest barriers to the activities of foreign funds in Poland is the unstable tax law. Can we expect normalisation in this field in 2025?
The tax system's instability has been a significant barrier for foreign investors, including investment funds operating in Poland. Frequent changes in regulations and their ambiguity mean that foreign entities face an increased risk in terms of regular adaptation to dynamically changing regulations.
As an example of a change that is problematic at many stages, one can mention the new regulations on real estate taxation, in force since 1st of January, 2025. They intended to adapt the tax system to the judgment of the Constitutional Tribunal of 4 July 2023 (ref. SK 14/21), which excluded the further possibility of defining the subject of taxation based on non-tax regulations, i.e. in this case regulations of the construction law. New definitions have been introduced (e.g. building, structure, technical and functional whole), which are intended to facilitate the correct classification of real estate in taxpayers' records. It should be noted, however, that such major changes not only force taxpayers who own real estate in Poland to conduct a thorough analysis of the composition of their fixed assets but may also lead to tax disputes regarding specific objects, as the jurisprudence line will now be formed anew.
Looking at the problem from this year's perspective, it is difficult to predict clearly whether the changes being introduced will be sufficient to provide real tax certainty in the long term. For the moment, investors still need to act with great caution and, more often than not, use the support of specialists to minimise the risks associated with failing to ensure business compliance with standards and relevant practices.
