Poles who want to buy an apartment in the UK and benefit from housing relief must hurry because they only have time to do so 31 December 2020
Housing relief shall be granted to the taxpayer who has acquired (purchased or inherited), all or part of the property, before the expiry of the 5 he made a disposal of the funds and allocated them to his own housing. Once this condition has been met, the funds raised are tax-free. Otherwise, the taxable person is obliged to tax the sale.
It should be stressed that the achievement of the objectives of housing may take place in the territory of a Member State of the European Union, as well as in a country belonging to the European Economic Area or to the Swiss Confederation, therefore, in relation to the brexit and transitional period, the United Kingdom fulfils the condition of exemption from this tax only to 31 December this year
It should be stressed that the achievement of the objectives of housing may take place in the territory of a Member State of the European Union, as well as in a country belonging to the European Economic Area or to the Swiss Confederation, therefore, in relation to the brexit and transitional period, the United Kingdom fulfils the condition of exemption from this tax only to 31 December this year
Confirms that one from the most recent interpretation of the individual tax law in which the applicant sold a single-family house in Poland with a plot in less than 5 years from the date of the inheritance and the abolition of joint ownership. The applicant wanted to benefit from housing relief and purchase properties in the UK.
In the request, he asked if if if he would buy a property (house/house) in the UK to 31 December 2020, that activity will be treated as a purchase of a property located in a Member State of the European Union and will therefore comply with the condition for exemption.
The Director of KIS agreed with the applicant and indicated that if the income from the sale of the property was spent by the applicant for the acquisition of the property (house/house) in the United Kingdom, the Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community (Official Journal of the European Union C, No.
144 I of 25 April 2019, p. 1), where under Article 126 From the date of entry into force of this Agreement to the date of entry into force, it is expected 31 December 2020 the so-called transitional period applies.
He also stressed that whenever Polish legislation mentions "a Member State of the European Union or of the European Atomic Energy Community" during the transitional period, the United Kingdom of Great Britain and Northern Ireland is also meant by this. This is due to Article 1 Act dated 19 July 2019 the transitional period referred to in the Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community (Journal of Laws of 2019, item 1516).
Thus, if, in the above case, the applicant who sold a single-family house in Poland with a plot less than 5 years from the date of the inheritance and the abolition of co-ownership will buy the property (house/house) in the UK to 31 December 2020, that operation will be treated as a purchase of a property located in a Member State of the European Union and the applicant will therefore comply with the condition for the exemption.
KIS Director Interpretation dated 26 October 2020, reference no. 0115-KDIT1.4011.614.2020.2.MT
Author: Paweł Boś
Junior Tax Consultant, related to Russell Bedford Poland 2018. Author of numerous articles on legal and tax matters, published in the industry press. Law student at Leon Kozminski Academy in Warsaw