Is the owner of warehouse properties equipped with photovoltaics an excise taxpayer?

 

JSz: Electricity is one of the excise goods. Warehouse owners with installed PV installations are therefore producing an excise good. However, whether they become excise taxpayers depends on several factors, such as what they do with the energy afterward.

 

Which specific activities related to electricity are subject to excise duty?

 

JSz: In the context of warehouse properties, the most relevant are:

 

  • The sale of electricity to a final purchaser by an entity that produced the electricity, and

  • The consumption of electricity by an entity without a license that produced the electricity – so-called own consumption.

 

Who is considered the “final purchaser” in the case of warehouse leasing?

 

JSz: A final purchaser is an entity that does not hold a license for the generation, storage, transmission, distribution, or trading of electricity.
In a typical warehouse lease scenario, the tenant is the final purchaser of electricity. The sale of electricity to the tenant includes any factual or legal action that results in the transfer of possession or ownership of electricity to another entity.

 

Does every instance of making PV electricity available to a tenant constitute a sale?

 

JSz: Not necessarily. In practice, a sale occurs when the landlord makes the electricity available for unrestricted use by the tenant, e.g., based on a sub-meter. Such settlement, usually documented by an invoice, has the characteristics of a sale and may therefore constitute a taxable transaction, resulting in excise obligations.

Using this energy for property maintenance purposes within service charges – e.g., lighting common areas or technical rooms – can be classified as own consumption for the landlord’s business activity. Such consumption, under certain conditions, may be exempt from excise duty.

 

What are the conditions for this exemption?

 

JSz: The exemption applies to the consumption of electricity by an entity that produced it from generators with a total installed capacity not exceeding 1 MW. An entity benefiting from this exemption is not required to register for excise purposes or maintain electricity records. However, the energy must be consumed by the producer – it cannot be resold in any form.

 

In practice, PV often only supplements grid electricity. How should settlements with tenants be structured to avoid excise duty?

 

JSz: This is a practical challenge. Grid electricity, purchased by the landlord with excise duty already paid, can be re-invoiced to the tenant without additional taxation. The issue arises with the sale of untaxed PV electricity. Here, the structure of settlements in lease agreements is crucial. It is possible to adopt a method where electricity produced from photovoltaics, although actually consumed by the tenant, is not treated as a separate sale but as the landlord’s own consumption, with its cost included in a broader payment, e.g., rent.

 

If the invoice or settlement document does not itemize the cost of consumed electricity, tax authorities generally do not consider it a sale subject to excise duty. In such a case, the landlord consumes the energy “for own use” and, if the installation is up to 1 MW, may benefit from the exemption.

 

However, itemizing the energy cost on the invoice for the tenant – where the cost of consumed energy is a separate line item and includes PV electricity – is treated as a sale subject to excise duty. In such a case, the landlord becomes an excise taxpayer for that sale.

 

So in practice it is the lease agreement and invoicing method that determine whether excise duty applies?

 

JSz: Exactly. This is the most commonly used solution in practice. One must be very careful with how contractual provisions are worded and how settlements are actually carried out. Sometimes an error results from the manager’s oversight or from billing system limitations, which, despite contractual provisions, invoice the tenant for all consumed energy in a way that suggests a sale of PV electricity.

 

And if the landlord does become an excise taxpayer for PV electricity supplied to tenants – what obligations arise?

 

JSz: If a taxable transaction occurs, the landlord has several key obligations:

 

  1. Registration obligation: Register in the Central Register of Excise Entities (CRPA) before the first taxable transaction.

  2. Declaration obligation: Submit tax declarations and pay excise duty by the 25th day of the month following the month in which the tax obligation arose.

  3. Record-keeping obligation: Maintain quantitative records of electricity. The scope and method of record-keeping are defined by regulations.

 

What is the current excise duty rate on electricity?

 

JSz: The rate is PLN 5.00 per megawatt-hour (MWh). The tax amount for electricity produced by a small installation (e.g., 30 kWp) may be negligible, amounting to a few dozen złoty per month. This may give a false sense of security that any failure to fulfill obligations will have minimal consequences.

 

So the main issue is not the tax amount itself, but the other excise obligations?

 

JSz: Correct. The greater risk for taxpayers is failing to meet other obligations – such as not registering in CRPA, not submitting declarations, or not keeping records. These failures may result in penalties under the Fiscal Penal Code (KKS) for persons responsible for tax matters in the company. For example, failure to submit a registration application to CRPA, submitting it late, or providing incorrect data may result in a fine of up to 120 daily rates.

 

And what do the penalties for non-compliance look like in practice?

 

JSz: The amount depends on daily rates determined by the court or on the minimum wage in the case of tax offenses. A fine for a tax offense ranges from PLN 466.60 to PLN 93,320. The maximum amount of a fiscal penalty ticket is PLN 23,330. In practice, a fiscal penalty ticket is usually applied in such cases, and it is rarely the maximum amount. These are not high amounts, but they are significantly higher than the potential unpaid tax itself.

 

Is there a way to avoid these penalties if the obligations were overlooked?

 

JSz: Yes, there is a mechanism known as the voluntary disclosure procedure (czynny żal). It can be used provided that no audit or enforcement proceedings have been initiated. However, voluntary disclosure requires the immediate fulfillment of all previously omitted obligations – that is, registration, submission of overdue tax declarations, payment of excise duty (if due), and completion of electricity records.

 

What practical recommendations would you give owners and managers of warehouse properties in the context of photovoltaics and excise duty?

 

JSz: The key points are:

  • Conduct a timely tax analysis of lease agreements.

  • Instruct property managers on the correct method of settlement, so that PV energy (if the installation is below 1 MW) is treated as own consumption rather than a sale.

  • Continuously monitor how settlements with tenants are actually carried out, and whether the cost of PV energy is itemized on invoices.

 

It is also important to keep in mind the regulations in case of potential expansion of the installation. Exceeding the 1 MW capacity threshold results in the loss of the exemption for own consumption, which may require a separate tax analysis.

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Editor’s Note: The above material is for informational purposes only and does not constitute legal or tax advice. For binding interpretations or individual guidance, we recommend consulting a tax specialist or the competent tax authority.

 

Source: ASB Poland Sp. z o.o.