Real estate tax exemptions

DE MINIMIS AID
(Resolution No. XLIV/608/2014 of the City Council, dated 25 June 2014)

What can be exempted?

• Newly-constructed buildings and structures or parts thereof and land assigned to them,
• Newly-acquired land, buildings and structures or parts thereof and land assigned to them, associated with carrying out new investment projects and creating new jobs under such projects in the City of Inowrocław.

What conditions need to be met?

• The new investment must increase the employment rate,
• The tax authorities (President of Inowrocław) must be notified in writing about undertaking of the investment project, its estimated completion date and the anticipated increase in the number of new permanent jobs, within 14 days following the date of project commencement,
• The new investment project must be completed within 3 years from the date of notification of its commencement by the investor, except for the types of projects specified in Art. 2, Section 3b of the Resolution (i.e. investments in newly-acquired land, buildings and structures) which should be completed no later than 1 year from the date of the above-mentioned notification,
• The ownership or a perpetual usufruct right of the real estate where the investment project creating new jobs is located must be retained at least as long as the tax exemption remains valid,
• In connection with the new investment project new jobs must be created and retained in the location of the real estate for at least as long as the tax exemption remains valid,
• Contracts with new employees must be signed for at least as long as the investment project remains subject to the exemption.

Real estate tax exemptions are granted for the following periods:

• 1 year, if at least 10 new jobs are created as a result of the investment project
• 2 years, if at least 20 new jobs are created as a result of the investment project
• 3 years, if at least 30 new jobs are created as a result of the investment project
• 4 years, if at least 50 new jobs are created as a result of the investment project
• 5 years, if at least 100 new jobs are created as a result of the investment project

A real estate tax exemption applies only to the land, buildings and structures or their parts which are new investment projects used by the investor for economic activity.

The exemption referred to in the Resolution does not apply to entrepreneurs who have been granted remission of overdue taxes for the municipal budget, or who are in arrears with the payment of taxes being a source of budget revenues for the Municipality.

The right to the real estate tax exemption does not apply to real estate acquired for the following activities: real estate development, petrol stations, banking and financial services, retail and wholesale trade.

The Resolution applies to entrepreneurs commencing new investment projects after 1 July 2014.

When the investment project is completed

• The entrepreneur submits documents specified in the application (enclosed with the Resolution) to the relevant tax authority within 2 months from the date of completion of the investment project,
• The tax authority must receive quarterly reports on the current level of employment and a copy of the current social insurance statement (ZUS DRA form) with acknowledgment of its submission to the Social Insurance Institution (ZUS), within 25 days following each quarter, as long as the condition of a minimum employment period specified in the Resolution applies,
• If and whenever the entrepreneur receives any other de minimis aid while being tax exempted under the Resolution, the entrepreneur is obliged to notify the relevant tax authority of the value of such received support within 14 days from the date of receipt thereof according to the provisions of Commission Regulation (EU) No. 1407/2013 of 18 December 2013 on the application of Articles 107 and 108 of the Treaty on the Functioning of the European Union to de minimis aid (O.J. L 352 of 24 December 2013).

New investment project – means financial outlays for:

a) Newly-constructed buildings, structures or their parts, intended for business activity,

b) Newly-acquired land, buildings and structures or their parts, intended for business activity.

New jobs – means an increase in the level of employment with the entrepreneur as compared with the average number of employees for 12 months preceding the month of commencement of the given investment project. A new job is considered to be connected with a new investment project if it is created within a year from the date of completion of the project.

*After 1 July 2014 the maximum share of state aid available to entrepreneurs in the Kujawsko-Pomorskie Province within any regional aid scheme was reduced by 15% and now may not exceed 35% for large enterprises, 45% for medium-sized enterprises and 55% for small-sized enterprises.