Tax department

Double declining-balance depreciation of property

Polish tax regulations provide for a number of extraordinary instances where one can apply a double rate (to increase the rate) of depreciation of property. The CIT Act allows for increasing the depreciation rate from the list by using a ratio not exceeding 1,2. This is applicable to buildings and structures used in deteriorated conditions, i.e. exposed to a constant impingement of water, vibrations or temperature fluctuations.

The consecutive provisions allow for increasing the discussed rate by using a ratio not exceeding 1.4. This pertains to a specifically defined category of buildings and constructions only. It consists of buildings exposed to the destructive influence of chemicals. Particularly, the production and storage of such chemical substances is concerned. In the same way there is concern about the proximity of other buildings from which the chemicals become dispersed into the air.

About the regulations

These regulations are of relatively general nature. Thereby, they provide noteworthy latitude for the taxpayers to apply the double declining-balance depreciation of property. On the other hand, tax authorities also retain this latitude. They interpret the provisions on their own and decide whether the double declining-balance depreciation of a given property may indeed be increased, and if so, by the maximum ratio of 1,2 or even 1,4. On the other hand, tax authorities also retain this latitude.

CGO Legal law firm renders consulting services regarding the problems of double declining-balance depreciation of property. On top of that, we support our Clients in determining the factual circumstances and the legal status. We also help in gathering the documentation required by the tax authorities for the purposes of conduction such depreciation.

If you want to learn more double declining-balance depreciation of property, please do not hesitate to contact us.