Charging a tenant for repair costs requires an invoice

A landlord that repairs rented machinery damaged by a tenant and charges the tenant for the work is providing a service subject to VAT, according to an individual tax interpretation issued by Poland’s National Tax Information director on June 18, 2026.

The ruling concerned a company that rents out machines and equipment. It asked how it should document and account for charges when a tenant’s fault makes repairs necessary.

The repairs are carried out by the company itself or on its behalf, while the tenant bears the cost. The company said the charges cover only the cost of restoring the equipment. They are not contractual penalties or compensation, but a transfer of the expenses required to return the machinery to its pre-damage condition.

The amount charged includes the value of parts used in the repair and the repair service itself. The tax authority treated the arrangement as a paid service, meaning the landlord must issue a VAT invoice rather than document the payment as damages.