Capital Gains Tax on Inherited Property in Poland: The 5-Year Rule Explained
Capital Gains Tax on Inherited Property in Poland: The 5-Year Rule Explained
Inheriting real estate in Poland is one thing. Selling it without triggering a 19% capital gains tax is another. The difference comes down to a single question: when did the deceased originally acquire the property?
Most English-speaking heirs assume the tax clock starts when they inherit. It does not. Poland's five-year rule works differently from what most foreign families expect, and understanding it before listing the property can save tens of thousands of zloty.
How the 19% PIT-39 Capital Gains Tax Works
When you sell inherited real estate in Poland, any profit is subject to a flat 19% income tax (PIT-39). The taxable gain is the difference between the sale price and the acquisition cost — for inherited property, that means the value at the time of inheritance, not what the deceased originally paid.
The tax applies to all types of real property: apartments, houses, agricultural land, commercial buildings, and undeveloped plots. It does not matter whether you are a Polish resident or a foreign heir — if the property sits in Poland, Poland taxes the sale.
The Five-Year Acquisition Rule
Here is the critical detail that catches most foreign heirs off guard: the five-year exemption period runs from the end of the calendar year in which the deceased acquired the property, not from when you inherited it.
If your mother bought an apartment in Krakow in March 2018, the five-year clock started on December 31, 2018, and expired on December 31, 2023. If she died in 2026 and you inherited the property, you can sell it immediately with zero capital gains tax — the five-year window has already closed.
But if the deceased purchased the property in 2024, the window does not close until December 31, 2029. Selling before that date triggers the full 19% tax on the gain.
This rule makes the deceased's original purchase date the single most important piece of information for any heir considering a sale.
The Reinvestment Exemption (Ulga Mieszkaniowa)
If the property falls within the taxable five-year window and you need to sell, Poland offers one escape: the reinvestment exemption (ulga mieszkaniowa).
You can avoid the entire 19% tax by reinvesting the full sale proceeds into another residential property for your own housing purposes. The reinvestment must happen within three years from the end of the tax year in which you sold.
Key restrictions:
- The replacement property must be for your own residential use, not investment
- You must reinvest the entire sale proceeds to eliminate the tax completely — partial reinvestment reduces the tax proportionally
- The replacement property can be located in Poland or in another EU/EEA member state
- The three-year deadline is strict and cannot be extended
For heirs who plan to use the inherited property themselves or buy a replacement home, this exemption effectively eliminates the capital gains issue entirely.
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Updating the Land Register (Księga Wieczysta) After Inheritance
Before you can sell, lease, or legally manage inherited real estate, you must update Poland's Land and Mortgage Registry (Księga Wieczysta) to reflect your ownership. No buyer or bank will proceed without a clean title.
The process requires:
- Obtain a court probate decree or notarial certificate of succession — this is your legal proof of heirship
- File Form KW-WPIS with the Land and Mortgage Registry Department of the district court that holds jurisdiction over the property's location
- Pay the statutory court fee of 150 PLN — this is a flat fee regardless of the number of heirs or the property's value
If you used the notarial route for your succession certificate, the notary can file the land registry update electronically on your behalf immediately after drafting the deed. This convenience costs approximately 500 PLN total (200 PLN net for the protocol, 200 PLN net for the filing petition, VAT, and certified copies) plus the standard 150 PLN court fee.
The registry update is not optional. Polish courts can impose fines on heirs who fail to update the land register within a reasonable period after establishing heirship.
Non-EEA Heirs and Property Permits
US, UK, Canadian, and Australian citizens inheriting Polish real estate through statutory succession (intestate) are exempt from needing a government permit under Article 1 of the Act on the Acquisition of Real Estate by Foreigners.
However, if the property was inherited through a will (testamentary succession), a complex legal analysis may be required, and a permit application could be necessary. This distinction matters — get legal advice before assuming the exemption applies.
What to Do Before Selling
If you are considering selling inherited property in Poland, work through this sequence:
- Find the deceased's original acquisition date — check the land register entry, the original purchase deed, or the prior probate documents
- Calculate whether the five-year window has closed — count from December 31 of the acquisition year
- Update the Księga Wieczysta — you cannot sell without a clean title showing your name
- File your SD-Z2 inheritance tax exemption within six months of your probate confirmation — this is separate from capital gains and protects you from inheritance tax on the property's value at death
- Consult a tax advisor about double taxation treaties — if you are a tax resident of another country, your home country may also tax the gain, though most treaties provide a credit for Polish taxes paid
The Someone Died in Poland guide includes a complete real estate chapter with the KW-WPIS filing procedure, fee schedules, and a decision framework for whether to sell, hold, or rent inherited Polish property.
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