Private rental income tax in Poland — the 8.5% and 12.5% lump sum in practice

Private rental income tax in Poland — the 8.5% and 12.5% lump sum in practice

If you rent out an apartment in Poland privately — outside of a registered business — you settle with the tax office using the lump-sum tax on recorded revenue (ryczałt). This is currently the only available form of taxation for private rentals; the progressive general rules can no longer be chosen. The good news: the lump sum is simple — you pay a percentage of your revenue and keep minimal records. The downside: you cannot deduct costs such as renovations or mortgage interest. Here is how the system works in practice.

Who pays the lump-sum tax

The lump sum on rental revenue applies to individuals renting out property as a so-called private rental — that is, not as a registered business activity. Typically: you own one or a few apartments and rent them out long term. It does not matter whether you rent a studio, a house or a parking space. If, however, you run a registered rental business, you settle under the rules applicable to businesses.

Two rates: 8.5% and 12.5%

The lump sum has a progressive structure with a single threshold:

• 8.5% — on revenue up to PLN 100,000 per year,
• 12.5% — on the excess above PLN 100,000.

Importantly, the higher rate applies only to the excess, not to your entire revenue. Crossing the threshold does not mean your whole rental income is suddenly taxed at 12.5%.

Married couples with joint marital property may file a declaration that the entire rental revenue will be taxed by one spouse. In that case the 8.5% threshold rises to PLN 200,000 — often a worthwhile option when rental revenue exceeds PLN 100,000 per year.

What counts as revenue — and what does not

The tax base is revenue actually received — what matters is the moment the tenant pays, not when an invoice is issued. Two items cause the most confusion in practice:

• The security deposit — it is not revenue. It is refundable and serves as collateral, so no tax is due on it. It only becomes revenue if you retain it to cover unpaid rent.
• Utilities and service charges — if the lease agreement clearly states that the tenant bears the cost of utilities (electricity, gas, water, internet) and administrative fees, with the landlord merely passing the payments on, these amounts generally do not constitute the landlord's revenue. The wording of the agreement is crucial — without it, the tax office may treat the entire payment as revenue.

The rent itself — the amount the tenant pays for the use of the dwelling — is, of course, taxable revenue.

Deadlines: payments by the 20th, PIT-28 by 30 April

You pay the lump sum yourself, without any notice from the tax office:

• tax payment — by the 20th day of the month following the month in which you received the revenue (rent for June paid in June is settled by 20 July),
• some taxpayers may settle quarterly — the payment is then due by the 20th day of the month following the quarter,
• the annual PIT-28 return — filed by 30 April of the following year.

Payments go to your individual tax micro-account.

Worked examples

Example 1: one apartment. You rent out an apartment for PLN 3,000 per month, and the tenant additionally pays utilities based on usage (as stated in the agreement). Your annual revenue is PLN 36,000. Tax: PLN 36,000 × 8.5% = PLN 3,060 per year, i.e. PLN 255 per month.

Example 2: crossing the threshold. You rent out three apartments with annual revenue of PLN 120,000. Tax: PLN 100,000 × 8.5% = PLN 8,500 plus PLN 20,000 × 12.5% = PLN 2,500. Total: PLN 11,000.

Example 3: the spousal declaration. The same PLN 120,000 revenue, but the spouses declared that one of them will tax the entire amount. The 8.5% threshold is then PLN 200,000, so the tax is PLN 120,000 × 8.5% = PLN 10,200. Savings: PLN 800 per year.

Want to calculate the tax for your own situation? Use our free rental tax calculator.

A few more things to keep in mind

• The lump sum is charged on revenue — renovations, furnishings and loan interest do not reduce the tax base.
• Make sure the lease precisely regulates utilities — those clauses decide whether re-invoiced charges count as your revenue.
• Keep a simple record of tenant payments — in case of an audit you must be able to show when and how much you received. A rental management app such as Brokik helps here, recording rent payments and letting you check the payment history for each property at any time.
• With several properties, the PLN 100,000 threshold applies to your total rental revenue, not to each dwelling separately.

Summary

The lump-sum tax on private rentals is easy to handle: 8.5% on revenue up to PLN 100,000, 12.5% on the excess, payments by the 20th of the following month and PIT-28 by 30 April. The keys to safe settlement are a well-drafted lease (utilities borne by the tenant), knowing that the deposit is not revenue, and reliable payment records.

This article is for information purposes only and does not constitute tax advice. For individual matters, consult a tax adviser or your tax office.