Residential sales tax - current rules, exceptions and practical examples for the new year

The sale of real estate carries significant tax consequences, which many owners only become aware of at the stage of finalising the transaction at the notary. This is particularly noticeable in large cities, such as the Tricity, where the number of transactions is increasing year on year and changing tax regulations affect the way settlements are made. Understanding the basic rules allows you to avoid mistakes and consciously prepare for the entire procedure.

For this reason, it is useful to know when tax liability arises, what exceptions are provided for by the law and how reliefs can be legally availed of. Knowledge of these rules is particularly important for those planning to sale of a flat in Gdańsk, as it enables proper transaction planning and financial decisions to be made in line with current regulations.

I invite you to read on.

What is the tax on the sale of a flat?

Real estate sales tax is the personal income tax (PIT) that arises when the owner disposes of the flat before the expiry of 5 tax years. This period is calculated from the end of the calendar year in which the property was acquired or built. The rule is general in nature and covers the sale of different types of real estate - not only flats, but also single-family houses, building plots or cooperative housing rights. In practice, this means that many transactions, especially those made within a short time of purchase, could potentially be taxable.

It is worth emphasising, however, that the sale itself does not yet prejudge the need to pay tax. The legislator has provided for a number of exceptions and reliefs which make it possible to avoid the tax burden altogether, provided that certain conditions are met. Therefore, before finalising the transaction, it is advisable to analyse in detail the date of acquisition of the real estate, the manner of settlement of the purchase costs and the purpose of allocation of the funds obtained from the sale. Also of key importance is the legal status of the property and whether the sale is a private or business asset, which can completely change the tax treatment.

How to calculate the 5-year tax period?

Although the principle seems straightforward, practice often raises questions. It is worth remembering that the 5-year tax period is not calculated „every day”. It always covers full tax years and starts from the end of the calendar year, in which the property was acquired or constructed. Only after this period has elapsed is the sale completely tax-free.

This approach by the legislator is intended to simplify settlements, but for many owners it leads to confusion. This is particularly the case if the flat was bought at the end of the year or inherited - in which case, the real time to wait for the tax-free period may be shorter than the person selling intuitively assumes.

Example of calculation of a 5-year period

If someone bought a flat in July 2021, the tax period counts from 31 December 2021. This means that five years pass 31 December 2026., and sales made from 1 January 2027 onwards are no longer taxable - even if they take place on the exact first day of the new year.

Such rules are of particular importance for those planning to sale of a flat in Gdańsk, especially when the property was acquired relatively recently or came to the owner as a result of an inheritance. Precisely establishing the date of acquisition often determines whether a tax settlement will be necessary.

Tax exceptions - when do you not have to pay?

Although the basic rule imposes a tax obligation on the sale of real estate before the expiry of five tax years, the regulations provide for several important exceptions that may completely exempt the owner from paying PIT. These solutions are intended to protect people who change residence, invest for housing purposes or inherit property from relatives. As a result, even transactions carried out within a short period of acquiring a flat can be legally tax-free, provided that the relevant conditions are met. The following are the most important exemption mechanisms, which are worth examining before finalising the sale.

1. housing allowance - allocating funds for own housing purposes

The most popular mechanism to avoid tax is the housing allowance. It allows tax exemption provided that the proceeds from the sale are used for your own housing purposes, such as:

• purchase of another flat or house,
• construction or extension of a house,
• general refurbishment of the flat,
• repayment of a mortgage taken out for a housing purpose.

The taxpayer has 3 years, calculated from the end of the tax year in which the sale took place. This solution is particularly popular with people changing their place of residence - e.g. moving from other cities to Gdansk or changing districts within the Tri-City.

2. sale after 5 years

If the owner sells the property at the end of the five-year period, the transaction is entirely tax-free. It does not matter the amount received or what the funds will be used for.

Inheritance - counting the period from the testator's acquisition

In the case of inheritance, the 5-year period counts from the date of acquisition of the property by the testator, and not from the moment the heir becomes the owner. In practice, this solution very often eliminates the tax liability - especially for older family properties.

Tax on the sale of a flat - how much is it and how to calculate it?

The income tax on the sale of real estate is 19% and is charged on income, not on the total amount of sales. Income is the difference between revenue (selling price) and deductible costs. These costs include, but are not limited to:

• the purchase price of the property,
• PCC tax,
• notary fees,
• brokerage commission,
• documented outlays increasing the value of the dwelling (e.g. cost of renovation).

To help understand the calculation mechanism, a simplified table is provided below.

How do I calculate tax on the sale of a flat?

Settlement element	Description	Quota example
Revenue	Sales price of the flat	PLN 600 000
Acquisition costs	Purchase price, PCC, notary costs	480 000 PLN
Expenditure (documented)	Value-enhancing renovation	PLN 20 000
Income	Revenue - costs - expenditure	PLN 100,000
Tax 19%	19% × revenue	PLN 19,000

Practical examples of settlements

Below are three different examples of tax settlements. One at a time:

Example 1: Sale before 5 years without relief

Mr Adam bought the flat in 2022 for £450,000. In 2024, he sold it for PLN 530 000.
Income: PLN 80 000 → tax: PLN 15,200.

Example 2: Sale before 5 years but with housing relief

Ms Maria sold the flat in 2024 and will use the funds within three years to purchase another property.
In such a case, the tax shall be PLN 0.

Example 3: Sale of an inherited flat

Mr Tomasz inherited the flat from his father, who bought it in 2010.
The sale in 2024 is tax-free, even though the inheritance was received a year earlier.

The importance of location - selling a flat in Gdansk and tax issues

Although tax regulations apply throughout Poland, in larger cities - such as Warsaw, Wrocław, Poznań or Gdańsk - the topic comes up particularly frequently. This is due to the high dynamics of the market, the increasing number of transactions and more frequent changes of residence. Owners sell their flats faster than in other regions, which increases the likelihood of selling before the five-year tax period expires. For this reason, it is advisable to carefully analyse the date of acquisition, the costs surrounding the purchase and the possibility of taking advantage of reliefs before finalising the transaction, which can significantly reduce the overall tax burden. dates, costs and the possibility of taking advantage of reliefs before finalising the transaction.

Summary

The sale of a flat requires an analysis of the tax rules, especially regarding the 5-year tax period that determines the obligation to pay PIT. Even if the sale takes place before this deadline, the owner may benefit from exceptions - such as the housing allowance or inheritance rules - that allow the tax to be avoided altogether. It is also crucial to calculate the income correctly and to take into account acquisition costs and documented expenditures that increase the value of the property.

Knowledge of these rules is particularly important in dynamic markets, where the frequency of transactions increases the risk of a sale before five years. An informed approach to the rules allows owners to prepare for transactions legally, avoid unnecessary costs and carry out the sale process more efficiently and without the risk of tax errors.

FAQ - Frequently asked questions

1. do I always have to pay tax if I sell my flat before 5 years have passed?

No. You can benefit from housing relief if you use the funds for your own housing purposes within 3 years.

2. can the renovation of a flat be counted as a tax-reducing expense?

Yes, as long as you have VAT invoices to support the expenses incurred.

3. Does the sale of a flat in Gdansk differ in terms of taxation from sales in other cities?

No, but more frequent transactions in large cities increase the risk of a sale before 5 years.

4. does inheritance always exempt from tax?

Not always, but the 5-year period counts from the time of acquisition by the testator, which often eliminates the tax liability.

5 When do I have to file a PIT-39 return?

By 30 April of the year following the sale of the property.