Business activity in an apartment and real estate tax


Many entrepreneurs who now manage world-famous companies started out with doing business in an apartment. Many business owners still use this option. It is a solution that allows for significant savings - it is possible to count as tax deductible expenses related to the operation of the premises in the part intended for corporate purposes. However, one should bear in mind the disadvantages of running a business in an apartment - they certainly include frequent increases in real estate tax by the commune. For what reason? We explain below.

Real estate tax - the rate will be established by the commune

Each entrepreneur who has decided to run a business in his own apartment must remember that he should submit this information to the commune office. On this basis, it is determined whether the flat (or part of it) is converted into a commercial property.

The real estate tax rate depends on the commune's decision. It adopts its amount based on the maximum real estate tax rates announced by the Minister of Finance. In 2014, for a residential premises, the levy is PLN 0.74 per 1 m2 of usable floor space, while for a building or parts thereof that are related to a business and are occupied for business purposes, the tax is PLN 23.03 per 1 m2 of floor space. usable. As you can see - the difference is huge.

Economic activity in the apartment - always a change in use?

At this point, it should be emphasized that there is not always a change in the use of the premises (and thus a higher property tax is imposed). It takes place when the flat, in whole or in a separate part, is used only for running a business. On the other hand, if the company is run in a room that is also used for residential purposes, then there are no grounds for changing the real estate tax rate.

This means that just running a business in an apartment is not the basis for paying a higher tax. However, it will arise when the entrepreneur allocates a room, e.g. for the purpose of creating an office or a doctor's office there. The mere insertion of a desk, a computer and a bookcase with several binders is not enough to set a higher levy.

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Business activity in an apartment - how is the change in the use of the premises determined?

When assessing whether there has been a change in the use of the premises, the conditions set out in Art. 71 of the Construction Law, according to which such a change is understood in particular as taking up or abandoning in a building structure or its part of activity changing the conditions of fire, flood or work safety, health, hygiene and sanitary conditions or environmental protection, or the size or system of burdens.

However, this definition does not explain in detail when it can be considered that the use of the premises has changed. In this case, you can refer to the case law, e.g. the judgment of the Provincial Administrative Court in Gorzów Wielkopolski of March 15, 2012 (file reference number II SA / Go 57/12), or the judgment of the Supreme Administrative Court of February 8, 2007 ( reference number II OSK 306/06). It follows from the cited judgments that the findings in question should be made by comparing the new use of the facility (new function, activities to be carried out in the facility) with the manner of its use specified in the building permit decision, or possibly with the use indicated in later decisions, such as an occupancy permit.