Own business begins with a visit to a construction company: in order to adapt the premises to the needs of the business, one cannot do without the help of professionals. Firstly, the renovation of office premises requires a deep knowledge of the regulatory framework, and secondly, the project must be coordinated by the authorities, and work permits are issued to licensed specialists. Renovation of the office premises in Warsaw is entrusted to only proven contractors, which include the Euromed-Bud company, a leading expert in the design and renovation of commercial real estate in Poland.
Can the Rental Property Be Renovated?
Entrepreneurs renting business premises are often afraid to do renovations in order not to argue over expenses with the owner of the property, although the law protects the rights of the tenant. According to the Civil Code, it is impossible to rent an emergency facility – the landlord must ensure the possibility of the intended use of the premises and maintain it in the right condition or compensate the tenant for the costs of maintaining the premises.
On the other hand, without the consent of the landlord, it is not allowed to make changes to the decoration that are not related to the intended use of the premises or that are contrary to the lease agreement. Pending approval, rental payments can be reduced for up to three months, and if you document the need for renovation, the rental rate can be reduced for six months. Monthly records of documented costs are recorded, however, the total cost of renovation should not exceed the amount of six-monthly payments for the last 5 years.
However, the wording of the law can be interpreted in different ways: there is no clear definition of the intended use of real estate; it also does not specify what condition of the premises can be considered suitable. For this reason, it is advisable to discuss in advance and state in the contract the permissible changes in the interior and the distribution of costs between the parties. For example, the contract may oblige the tenant to bring the object to the required condition or stipulate the possibility of reducing the rent for renovation.
Overhaul of Common Areas
To prepare the premises for the reception of clients, it is often necessary to start an overhaul. For effective zoning of the space, redevelopment may be required, and before laying a new floor, the screed must be replaced or levelled. Old wiring, and worn out or obsolete utility lines do not support powerful modern equipment, so engineering networks will have to be expanded or completely changed.
The Euromed-Bud company will perform an overhaul in a short time and compliance with all standards – we work quickly, efficiently and accurately, and we try not to make noise and clean up the garbage. We have extensive experience in implementing large-scale projects, the logistics base is well organized, all the necessary permits have been issued, and most importantly, our employees are talented engineers and technicians who enjoy a job well done!
Designer Renovation of Commercial Premises
Unlike standard renovations, designer renovation is carried out according to a special project, taking into account the specifics of the business and the personal wishes of the customer. Architectural and planning solutions and corporate identity are tied to the structural characteristics of the premises, the most personalized approach makes the functionality and ergonomics of the space perfect.
During the renovation, architectural supervision is carried out; compliance with regulatory requirements, deadlines and quality of work performance are controlled. The result will not deceive your expectations, and the investment will pay off in full by increasing labour productivity and increasing sales – when the premises are designed with intelligence, both staff and customers are comfortable in it!
Minor Renovation of Commercial Premises
When the room is in good condition and generally meets the technological standards, it is enough to simply redecorate without resorting to large-scale reconstruction – re-paper the walls and change the floor covering, install a stretch ceiling, and replace furniture and decor. The minor renovation will breathe new life into the interior and increase the prestige of the business – a stylish, comfortable and well-kept room is associated with success and inspires more confidence.
Renovation of Commercial Premises on a Turnkey Basis
Business people do not always have time to improve the premises, so turnkey renovations, the services of a general contractor, are in demand in Warsaw. All types of renovation works are organized by one company, which takes responsibility for the result and hands over the finished object to the customer. The contract for the renovation of commercial premises on a turnkey basis includes a full package of services on an all-inclusive basis:
- preparatory work – taking measurements, analysis of the master plan and communications;
- development of a design project, working documentation and specifications;
- preparation and approval of estimates;
- approval and execution of permits;
- procurement of building materials and equipment;
- renovation work according to the schedule, if necessary, involvement of subcontractors;
- cleaning and removal of building waste;
- control of terms and quality of works; reporting.
The advantages of turnkey renovation are obvious: saving time and effort, convenience, and the possibility of implementing non-standard ideas. However, pitfalls should not be discounted: unscrupulous contractors inflate costs, impose unnecessary services, and are guided by personal motives when hiring contractors. With the Euromed-Bud company, you should not be afraid of tricks: we will save you the trouble, but you will retain full control over the process:
- each stage of renovation work is agreed with the customer, and the results are in line with expectations;
- no hidden surcharges – justification is attached to each item of the estimate;
- opportunities are being considered to optimize and reduce the cost of the estimate without sacrificing quality.
When Do We Deal with Corporate Premises Improvement?
When tax accounting for renovation costs, it should be taken into account that real estate included in the fixed asset register can be improved; in this case, the taxation of the costs incurred looks different than in the case of renovation without changing the operational properties of the object. The cost of capital improvement funds must exceed PLN 3,500 (net for VAT payers and gross for organizations exempt from VAT). The explanatory letter of the Minister of Finance of 1995 states that the following types of renovations are included in the improvements of fixed assets:
- rebuilding – changing the current state of immovable objects in order to expand the functionality, improve working conditions and the quality of maintenance of buildings;
- reconstruction – the full or partial restoration of fixed assets with a change in operational characteristics;
- expansion – enlargement of buildings, structures, technological lines and other assets;
- modernization – renewal of fixed assets, bringing them into line with new technological standards;
- adaptation – giving assets new functional properties or adaptation to new tasks.
Renovation of Company Premises – Roof Replacement
Replacing worn roofing may be considered a renovation and tax-deductible if the building is restored to its original condition. If modern materials are used to cover the roof, the changes can be interpreted as modernization; accordingly, costs are not subject to write-off as part of indirect costs.
Renovation of Corporate Premises – Replacement of Windows
Replacement of window and door profiles is aimed at improving the initial technical condition of the object and is qualified as a reconstruction. But if the replacement of windows was carried out as part of a scheduled renovation and did not entail a change in the size of the light openings and other technical characteristics of the room, the cost of replacing windows can be included in the total cost of renovation work, which is offset by a tax deduction.
Renovation of Corporate Premises – Replacement of Furniture
Furniture is not directly related to real estate and does not affect the operational properties of the premises, so it is not classified as fixed assets. If furniture needs to be changed to adapt the rooms to the needs of the business, the cost of the furniture may be charged to the original cost of the property and deducted as a depreciation expense.
Overhaul of Corporate Premises Before Entering into the Fixed Asset Register
When calculating income tax, real estate acquired for commercial purposes is assessed at the original cost; all types of improvement – overhaul, reconstruction and modernization increase the value of the object. Depreciation deductions are deducted from the cost of the premises, taking into account the costs of improvement carried out before the real estate was entered into the fixed asset register.
Renovation of Corporate Premises – Differences in Tax Accounting
Investments in the renovation of premises entered in the fixed asset register are covered by a tax deduction, written off as indirect expenses. This option does not apply to the cost of improving fixed assets, since the changes increase the value of the property relative to the value on the day of putting it into operation, which affects depreciation.
Professional Consultation
The Euromed-Bud company adheres to the principles of openness and transparency: you can contact us with any questions, comments and suggestions, and even better, order a preliminary consultation so that we can discuss all the nuances of cooperation. If you are renovating office space for the first time and do not know what to do, we will be happy to advise you on all issues of corporate real estate improvement. We will:
- help to formulate terms of reference;
- give you a price range and calculate the initial estimate free of charge;
- discuss ways to reduce operating costs;
- select certified building materials, reliable equipment and high-quality furniture at an affordable price.
After the End of the Lease
If you did not agree with the landlord on the distribution of renovation costs when concluding the lease agreement, but renovated the premises at your own expense, you can claim reimbursement of expenses within a year after the return. This gives the landlord the choice of keeping the improvements and reimbursing the tenant or returning the space to its original state.
List of Renovation Works Classified by the Landlord as Constantly Increasing the Cost of the Premises
The cost of the renovation of the rental property, which constantly increases its value, can be reimbursed on the basis of invoices, an assessment of the work by the AOM inspector, and an estimate based on the overhead ratio in a detailed method and verified by the technical services of the protection of civilians. The cost of the estimate should not exceed the average level of depreciation in the current quarter; changes that constantly increase the cost of the premises include the following works:
- replacement of entrance and internal doors, window profiles and window sills;
- reconstruction of the screed and replacement of the flooring (more than 60% of the area of the premises);
- connection of water supply and sewerage, installation of sanitary equipment;
- modernization of ventilation systems, installation of mechanical ventilation units;
- concealed wiring (with a switchboard and without accessories).
Commercial Property Renovation Cost
Prices for the renovation of commercial real estate vary in a wide range – the volume and complexity of the work, the purpose of the repair, the specifics of the object and the type of activity matter. The final cost of renovating the office space is calculated individually for each project; at the same time, we try to keep within the allocated budget and offer the best price. Specify the details with a consultant or leave a request for the calculation of the initial estimate on the company’s website, and we will contact you as soon as possible!
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