Newsletter: REal Knowledge about the Polish real estate market 2/2021
Welcome to the second edition of Deloitte REal Knowledge newsletter!
REal Knowledge about the Polish real estate market 2/2021
Welcome to the Deloitte REal Knowledge newsletter. Through this newsletter we would like to give you more information about the Polish real estate market. Topics will vary from tax and legal news, updates to other hot topics from across the Polish real estate sector.
In this edition we come back to the topic on withholding tax regime in Poland as the Ministry of Finance has published the draft regulations on CIT and PIT deferring certain withholding tax provisions introduced in 2019 until 31 December 2021.
We will also provide more information on recent amendments to the Construction Law which in overall was intended to provide an abolition for owners of premises constructed under invalid building permits.
Moreover, we will zoom in on real estate-rich company clause in the Double Tax Treaty between Poland and the Netherlands as well as we will tell you more about Taxonomy and its obligation for real estate companies.
Finally, we encourage you to discover our latest report – Warsaw Crane Survey 2021.
We wish you happy reading!
Withholding tax changes deferred again
The Ministry of Finance has published the draft regulations on CIT and PIT deferring certain withholding tax provisions introduced in 2019 until 31 December 2021.
According to the explanatory memorandum to the draft regulation published by the Ministry of Finance, the postponement is due to the exceptional circumstances of the COVID-19 pandemic in which it is unjustified to burden withholding agents and taxpayers with additional obligations. The Ministry has also announced that the legislative process is underway to amend the statutory withholding tax rules and incorporate the changes earlier consulted with the representatives of the business sector.
Declaration of invalidity of a decision on building permit due to lapse of time
The Act of 13 February 2020 amending the Construction Law introduced Art. 37b (similar to Art. 59h of the Construction Law with respect to use permit), which in overall was intended to provide an abolition for owners of premises constructed under invalid building permits.
According to the above provision, a building permit shall not be declared invalid if 5 years have passed from the date of its delivery or announcement. By this, the legislator showed understanding towards investors who (often without their awareness) could be faced in future with invalidation of the building permit.
Real estate-rich company clause in the Double Tax Treaty between Poland and the Netherlands
The new Protocol to the Double Tax Treaty between Poland and the Netherlands, signed on 29 October 2020, introduces, inter alia, the so-called real estate clause which may result in CIT taxation of the sale of shares in Polish real estate rich companies by Dutch tax residents. The earliest expected date of entry into force for the amendments introduced by the Protocol is 1 January 2022.
Taxonomy – what’s in there for real estate companies?
ESG in Real Estate
The European Union is set to be climate-neutral by 2050. Therefore, far-reaching measures are taken to decarbonize the European economy. The real estate sector is in focus, as buildings are responsible for 36% of greenhouse gas emissions in Europe . The Green Deal is strategically relevant for real estate companies – it will impact business models, market demand and financing conditions. One of the changes worth preparing right now is the introduction of Taxonomy.
Warsaw Crane Survey 2021 – second edition
Real estate advisory
The Deloitte Warsaw Crane Survey 2021 is a barometer of business activity in Poland’s capital, in which we examine Warsaw’s current office stock and future potential supply.
This report is unique in analysing the modern office stock in all Warsaw’s districts with a special focus on building permits and administrative decisions. Through a collaboration with the City of Warsaw, we have also analysed the building permits issued during the last 11 years, giving us a complete overview of the trends influencing developer activities.
The number of building permits for Warsaw office projects fell significantly in 2020
Real estate advisory
Just two building permits for new office projects in Warsaw were issued in 2020, the lowest result in the period analysed (2010 – 2020) in the 2021 Deloitte Warsaw Crane Survey. This confirms the slowdown in building permits for office schemes identified in last year’s survey.