Important NSA Rulings on Investment Property Depreciation – What Does This Mean for Your Business?
The Supreme Administrative Court (NSA) has issued key rulings on tax depreciation deductions in real estate companies. Their impact could significantly affect tax settlement strategies for many businesses.
What’s Changing?
Since 2022, tax depreciation on real estate in property companies has been limited, depending on write-offs made under the Accounting Act. The issue arose for investment properties measured at fair value, which are not subject to balance sheet depreciation.
- Until now, tax authorities held that in such cases, tax depreciation should be zero.
- In January 2025, the NSA ruled (II FSK 788/23, II FSK 789/23, II FSK 987/23) that taxpayers should calculate a hypothetical balance sheet depreciation value and use it as the tax depreciation limit.
- In March 2025, the NSA went even further – in rulings (II FSK 896/23 and II FSK 246/24), it determined that in such cases, the tax depreciation limit should not apply at all.
What Benefits Could This Bring to Your Business?
- The opportunity to revise tax policies regarding investment property depreciation going forward.
- A chance to recover overpaid taxes from previous years.
Now is the time to act – if your group includes real estate companies where properties are classified as investments measured at fair value, this is the moment to reassess your approach to tax depreciation and take advantage of new opportunities.