Private rental or rental within a sole proprietorship (JDG) in Poland in 2026 — a comparison

The key differences

Private rental

• lump-sum tax of 8.5% up to 100,000 zł of annual revenue,
• 12.5% on the excess,
• no deduction of costs in PIT,
• no ZUS contributions from the rental itself,
• annual settlement on PIT-28.

Rental within a JDG

• the PIT form depends on your choice and the type of services,
• under the tax scale or flat tax, costs can reduce income,
• under the lump-sum tax, costs do not reduce the tax,
• the business affects ZUS and health contributions,
• records appropriate to the chosen form, plus VAT, are required.

Private rental does not have a single rate with no cap

The 8.5% rate applies up to 100,000 zł of annual revenue. The excess is subject to 12.5%.

Spouses share a common limit, and after filing the appropriate declaration that all revenue is taxed by one of them, the limit can be 200,000 zł.

It is incorrect to describe private rental as 8.5% regardless of the amount.

When rental is private and when it is business

The number of apartments alone does not automatically create a business. What matters includes, among other things:

• how the taxpayer classifies the asset components,
• the organization and scope of the activities,
• the type of services provided to tenants,
• entering the property into business assets,
• the content of the contracts and the actual operating model.

You cannot adopt a universal rule that "three or five apartments means a JDG." Short-term rental with services close to a hotel's is, however, a different model than long-term rental of premises.

Costs

In private rental, the lump-sum tax is calculated on the revenue received. Renovation, furnishings, interest, and the owner's fees do not reduce the tax.

In a JDG under the tax scale or flat tax, justified expenses connected with revenue can be costs, for example:

• renovations and repairs,
• furnishings,
• management,
• agents' commissions,
• interest on financing,
• utilities covered by the landlord.

You have to distinguish renovation from improvement and correctly determine when to recognize the expense.

Depreciation of residential property

Residential premises and buildings are not subject to tax depreciation — even when they are held in the business.

The ability to deduct other costs under the tax scale or flat tax does not mean a right to depreciate an apartment. Non-residential property requires a separate analysis.

VAT on residential premises

Renting out residential property on one's own account exclusively for housing purposes may benefit from the object-based VAT exemption.

The exemption does not depend on whether the owner is an active VAT taxpayer in another business. You must, however, have a contract and actual use confirming the housing purpose.

Rental for office purposes, tourist subletting, or accommodation do not automatically benefit from this exemption.

Commercial premises

Rental of commercial premises is, as a rule, taxed at 23% VAT. The taxpayer can, however, use the subject-based exemption if they meet the conditions and do not exceed the limit of 240,000 zł of sales in 2026.

The subject-based exemption and the housing exemption are two different legal bases.

Short-term rental

Short-term accommodation is usually a service taxed at 8% VAT, not exempt residential rental. In PIT, the lump-sum rate depends on the correct classification of the service and should not be chosen based on the PKD code alone.

Handling reservations, cleaning, frequent guest turnover, and additional services may point toward a business.

ZUS

Private rental on its own does not create an obligation to pay social or health contributions.

With rental within a JDG, the entrepreneur is subject to the ZUS rules applicable to the business. You should not, however, add a second full ZUS if the same person already runs another JDG — the effect of the additional revenue depends primarily on the form of taxation and the health-contribution base.

Not every contribution is a "rental cost." Social and health contributions have their own deduction rules.

VAT and the exemption limit

Turnover from exempt property transactions may, in certain situations, affect the subject-based exemption limit, especially when the transactions are not ancillary in nature.

You should not assume that every exempt residential rental is always disregarded when calculating the 240,000 zł limit for another business.

What to compare before deciding

1. annual revenue and the 100,000 zł threshold,
2. actual costs,
3. long-term or short-term character,
4. residential or commercial use,
5. existing business and ZUS,
6. the right to a VAT exemption,
7. how the property is classified,
8. the consequences of selling or withdrawing the premises.

It is not enough to compare the 8.5% lump-sum tax with the 12% tax scale. The scale taxes income and benefits from the tax-free amount; the lump-sum tax taxes revenue with no costs.

Most common mistakes

1. An 8.5% rate with no cap.
2. Treating many apartments as automatically being a JDG.
3. Depreciating an apartment held in the business.
4. A VAT exemption for every residential unit without checking the purpose.
5. Taxing short-term accommodation like ordinary rental.
6. Adding a full second ZUS to an existing JDG.
7. Ignoring the rental's effect on the VAT exemption limit.
8. Comparing rates alone, without costs and the health contribution.

Sources

• Podatki.gov.pl — private rental
• The Lump-Sum Tax Act — ISAP
• The VAT Act — ISAP

Do you need to calculate both options?

Oxyok compares the tax, ZUS, and VAT for rental and for the rest of your business. Bookkeeping costs from 49 zł + VAT per month.

Write to Paweł or see Oxyok bookkeeping.

This material is general in nature. Classifying a rental depends on the contracts, the assets, and the actual way it operates.