Subsidies and Tax Deductions

Thermomodernization Tax Deduction

This deduction can be obtained by individuals who are owners or co-owners of a single-family building, paying tax based on the tax scale, lump sum, or linear tax. The deduction is similar to the renovation tax deduction and allows for a deduction of up to 53,000 PLN from the tax base over a 3-year period.

Important Conditions

Expenses recorded for the thermomodernization tax deduction must be actually incurred for the thermomodernization of the building, for example, for the replacement of energy sources with renewable sources. The new installation should be located in the same building unless the entity demonstrates technical contraindications justifying the change. However, such a change cannot result in the new installation being disconnected from the residential building. In the case of married couples, each spouse can separately obtain a deduction of 53,000 PLN, which provides additional tax benefits. Expenses must be documented with VAT invoices in gross amounts. Earlier receipt of funding from NFOŚiGW or WFOŚiGW means that the individual cannot deduct expenses incurred for thermomodernization in that part.

The individual has exactly 3 years from the tax year in which the investment began to properly benefit from the deduction. For example, if you invest in new thermomodernization solutions in 2020, the investment should be completed by 2023. An energy audit will also be necessary before and after the thermomodernization. Importantly, the cost of such an audit is eligible for the deduction. All expenses that qualify an individual for the deduction are precisely listed in the regulation of the Minister of Investment and Development dated December 21, 2018 (Journal of Laws 2018, item 2489).

My Electricity Program

The government of the Republic of Poland has allocated 1 billion PLN to stimulate investments in the production of electricity from small photovoltaic installations by individuals in Poland. The program is relatively straightforward and clear for beneficiaries. The application process is quick (online), as is the disbursement of the allocated funds. The installation capacity should range from 2-10 kW and serve the needs of already built residential buildings. Assistance cannot be granted in connection with increasing the capacity of existing photovoltaic installations. The period for eligible costs is established from July 23, 2019, to December 31, 2025. Such costs include the purchase, installation, acceptance, and commissioning of the installation. The maximum value of the subsidy is up to 50% of the costs, but no more than 5,000 PLN per individual application.

Key Additional Conditions for Obtaining Support

• The photovoltaic installation cannot be created before July 24, 2019.
• Funding can be obtained for projects completed before the application submission date.
• One funding covers both the purchase and distribution agreement for energy.
• The application should be preliminarily accepted by the National Fund for Environmental Protection and Water Management (NFOŚiGW).
• Funding covers the purchase and installation of new installations, meaning those produced no more than 24 months before the date of installation at the client's site;
• The state requires effective operation of the installation for at least 3 years from the date of installation;
• The amount of the thermomodernization tax deduction is reduced by the value of the subsidy received from the My Electricity program.