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Rebilling utilities (water, electricity, gas, sewage, waste disposal) and VAT in rental agreements. How to determine VAT rate and tax liability.

  • Businesses renting out properties usually pass on the actual costs of utilities to tenants
  • There are different methods of accounting for utility costs in rental agreements
  • The method chosen can impact VAT taxation and when the tax liability arises
  • Three basic options for accounting for utility costs in rental agreements are: tenant contracts with utility providers, flat-rate charges, or passing on actual costs to tenants (refactoring)
  • The choice of accounting method is important for determining the moment of tax liability and applying the correct VAT rate
  • If tenants contract directly with utility providers, the costs are not invoiced to the landlord
  • In this case, the landlord only invoices rent and does not include utility costs in the invoices

Source: ksiegowosc.infor.pl

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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