If you are an owner or co-owner of a single family house (also: town house or semi-detached house), you are eligible for thermal upgrade relief.
When do you qualify for this tax relief?
You qualify if you incur expenses on the thermal upgrading of a single family house, including:
Expenses on window and doors, including windows, slope windows with installation systems, balcony doors, garage doors and non-opening transparent surfaces;
Calculating the tax relief
You can deduct the tax relief in the tax declaration:
- from taxable income under the tax scale, or
- taxable income under the flat tax, or
- revenue taxable under tax on registered revenue without deductible costs.
The deducted amount cannot exceed PLN 53,000 in relation to all thermal upgrade projects in the buildings you own or co-own.
If your expenses were taxed with VAT, you can deduct the amount with that tax, unless you deducted that tax based on the Goods and Services Tax Act.
The expenses on a thermal upgrade project that were not covered by your income (revenue) for the fiscal year in which you incurred them, they can be deducted in the following years. You can only deduct them for up to 6 years, starting from the end of the fiscal year in which you incurred your first expense.
If you fail to complete the thermal upgrade project in 3 years (starting from the end of the fiscal year in which you incurred your first expense), you will have to return the tax relief. This means that you will have to add the respective previously deducted amount to your taxable income for the year in which the 3-year period elapsed.
If following the year in which you used the tax relief, you receive the return on the deducted expenses on the thermal upgrade project, you are required to add, as appropriate, the previously deducted amounts to the income (revenue) in the declaration for the fiscal year in which you received that return.
Documenting the right to the tax relief
You can deduct the tax relief if you have an invoice issued by an active VAT taxpayer. The basis for the deduction can also be an invoice with the value added tax issued by an entity based in an EU member state.
What declaration should you file?
You can make the deductions in the PIT-36, PIT-36L, PIT-37 or PIT-28 tax declaration, which should be appended with the PIT/O attachment (deduction report).
Note:
You cannot use the tax relief if the building has not been commissioned (is under construction). You can use the tax relief even if you did not complete an energy audit before completing the thermal upgrade project.