Real Estate Tax in Lithuania in 2026: What You Need to Know

Real estate tax in Lithuania has been applied for many years and is calculated based on the taxable value of real estate. It was introduced to supplement municipal budgets and encourage the rational use of property. The Real Estate Tax Law defines when and to whom this tax applies. It is important to note that not everyone is required to pay it. For individuals, real estate tax applies only when certain value thresholds are exceeded or when additional property is acquired, while for legal entities it applies much more broadly, covering most of the real estate they own or use.

In 2026, the new real estate tax for legal entities is calculated using municipal rates (which generally range from 0.5% to 3% of the taxable property value), with an additional 0.2% rate introduced for defense funding. Individuals are subject to a separate taxation system: a primary residence is taxed only if its value exceeds EUR 450,000, while other residential property is subject to progressive rates ranging from 0.2% to 1%. New taxation principles and their application came into force this year, and this article explains them in more detail.

What Is Real Estate Tax?

Real estate tax is a legally established levy that all property owners are required to pay. This tax is directly related to the purpose and value of the property, so it is important to understand how it is applied and calculated. In Lithuania, the tax applies to both individuals and legal entities, and its amount may vary depending on the rules set by municipalities.

Real Estate Tax for Legal Entities

Real estate tax for legal entities consists of the municipal rate and an additional new rate. Municipalities set rates ranging from 0.5% to 3% of the taxable property value. Each municipality determines the exact rate individually. An additional 0.2% rate has also been introduced for defense funding. This is added to the municipal rate. The final amount depends on several factors: the purpose of the property, its taxable value, and the condition of the object.

What Real Estate Is Taxed for Companies?

For legal entities, almost all real estate owned, acquired, or used in Lithuania is taxable. Unlike individuals, companies are not eligible for “primary residence” exemptions or non-taxable minimums. The main categories of taxable property include:

• Commercial and administrative property (offices, administrative premises, stores, restaurants, service premises);
• Industrial and agricultural property (factories, warehouses, logistics centers);
• Hotels and recreational property;
• Engineering structures and unfinished construction objects (if they are actually being used).

The Impact of Municipal Real Estate Tax Rates on Business

Municipal tax rates directly affect company profitability and cash flow because differences between cities can be significant. Since the law allows municipalities to choose rates between 0.5% and 3%, the final tax bill for a property with the same taxable value in Vilnius and Kaunas may differ by thousands of euros. Although the percentages may seem small, for businesses managing large amounts of real estate, even a few tenths of a percent translate into substantial sums that directly reduce net profit.

Municipalities that apply lower rates also become more attractive for logistics centers or factories that require large premises, thereby increasing competition.

The Impact of Property Purpose on Taxation

The intended use of real estate is one of the main criteria allowing municipalities to differentiate tax rates. This means that two companies owning properties of the same value on the same street may pay different taxes simply because of the property’s purpose. Municipalities often encourage certain activities by applying lower rates to cultural, educational, or sports facilities. Since this affects the amount of tax payable, companies should carefully review the designated purpose of their property and assess whether some objects should be reclassified. However, it is important to emphasize that the property purpose registered in the Real Estate Register must correspond to the actual activity. Attempts to misuse the system by declaring an inaccurate purpose are risky. In such cases, the company may face recalculated taxes or other penalties.

Special Discounts and Exemptions for Companies

The law provides specific exemptions that may fully or partially exempt legal entities from real estate tax:

• Free Economic Zone (FEZ) exemption. This is one of the most significant tax incentives for businesses. Companies operating in FEZs are exempt from real estate tax.
• Municipal exemptions. Municipal councils may reduce the tax or fully exempt certain companies at the expense of the municipal budget.
• Purpose-based exemptions. Certain property categories are exempt under the law, such as objects used exclusively for environmental protection or fire safety. Property used for agricultural activities is also exempt if the company earns more than 50% of its revenue from agriculture.

Real Estate Tax for Individuals

The amount of real estate tax for individuals depends on the category of property owned. Tax on a primary residence is payable only if its value exceeds EUR 450,000. The rate ranges from 0.2% to 1% and applies only to the amount exceeding EUR 450,000. Other residential property is subject to progressive rates:

• Up to EUR 50,000 – exempt;

• EUR 50,000 to EUR 200,000 – 0.2%;

• EUR 200,000 to EUR 400,000 – 0.4%;

• EUR 400,000 to EUR 600,000 – 0.6%;

• EUR 600,000 to EUR 1 million – 0.8%;

• Above EUR 1 million – 1%.

The final amount depends on the type of housing (primary residence or not), its official value, and the municipal rate.

When Do Individuals Have to Pay Real Estate Tax?

Individuals must pay real estate tax when:

• The non-taxable value threshold is exceeded. If the primary residence exceeds EUR 450,000 in value, tax applies to the amount above this threshold. For other residential property exceeding EUR 50,000 in value, progressive rates apply.

• The annual tax amount exceeds EUR 5. If the final payable amount is very small (e.g., up to EUR 5), it does not need to be paid.

When Are Individuals Exempt from Real Estate Tax?

Individuals do not have to pay real estate tax when:

• The value of the property does not exceed the established threshold. If the value of a primary residence does not exceed EUR 450,000, no real estate tax is payable. Other residential property is not taxed if its total value does not exceed EUR 50,000.

• The accumulated annual tax amount is less than EUR 5.

• The property is unfinished construction. Real estate tax is generally not applied if the building has not yet been completed.

• The municipality grants tax relief. In some cases, municipalities may reduce or fully exempt individuals from real estate tax at the expense of the municipal budget.

What Property Is Included in Real Estate Tax Calculation?

The following property is included in the tax calculation:

• Residential buildings (e.g., rented housing);
• Recreational property;
• Auxiliary and agricultural buildings;
• Other-purpose property.

However, in every case certain value thresholds apply below which no tax is calculated.

When Is Real Estate Tax Paid?

Real estate tax applies to each calendar year.

• Legal entities must declare and pay tax for the previous year by February 15 of the following year.
• Individuals must pay the calculated tax amount by March 15.

Companies are also required to make advance payments three times per year: by March 15, June 15, and September 15. The final balance is due by February 15.

If a company experiences serious financial difficulties, it may negotiate installment payments with the tax administrator. The company must apply to the tax authority for deferred payment or to the municipality for tax reduction. The tax administrator decides whether to approve the request and determines the payment schedule, interest rates, and additional conditions.

How Is Real Estate Tax Calculated?

To calculate real estate tax for a company:

• Determine the taxable value. Check the property value in the Real Estate Register system.
• Select the applicable rate. Contact your municipality to determine the applicable rate.
• Calculate the tax. Multiply the taxable property value by the applicable rate.

Example: A company owns property with a taxable value of EUR 100,000, and the municipality applies a 1% rate.

If you're interested in an online real estate tax calculator, you can visit this link: https://www.skaiciuokles.com/nt-mokescio-skaiciuokle/ .

How to Declare and Pay Real Estate Tax?

Real estate tax declarations are submitted through the State Tax Inspectorate (VMI) system:

• Prieš deklaruojant, rekomenduojama patikrinti Registrų centro duomenis, nes mokestis skaičiuojamas pagal jų nustatytą mokestinę vertę.
• Tuomet prisijunkite prie Elektroninio deklaravimo sistemos (EDS).
• Spauskite „Pildyti formą“, tuomet „Formos kodas“ laukelyje įveskite atitinkamos formos kodą ir spauskite „Filtruoti“. Pasirinkite KIT711 (deklaruojant už 2025 m.) arba KIT719 (deklaruojant už vėlesnį laikotarpį) bei paspauskite „mėlyną gaubliuką“.
• Svarbu paminėti, kad fiziniams asmenims už nuosavybės teise priklausantį arba jų įsigyjamą NT apskaičiuos, NT mokesčio deklaracijos formą užpildys ir pateiks mokesčių administratorius.
• Įmonėms reikia pačioms suvesti visus reikalingus duomenis ir pateikti deklaraciją.
• Before declaring, it is recommended to verify Real Estate Register data because the tax is based on the taxable value determined there.
• Log in to the Electronic Declaration System (EDS).
• Select “Fill in a form,” enter the form code, and choose:
• KIT711 (for declaring 2025 tax);
• KIT719 (for later periods).

For individuals, the tax administrator calculates, completes, and submits the declaration automatically. Companies must enter all required data themselves and submit the declaration.

To pay the tax:

• Log in to the VMI system and select “Taxes and Fines.”
• Choose a payment method.
• If paying by bank transfer, use payment code: 1001.

Financing Options for Companies to Cover Real Estate Tax

Both individuals and legal entities may pay their tax obligations in several ways. Companies facing financial difficulties may use various financing solutions. Credit unions, banks, or online lending platforms can provide loans.

Business loans from online lending platforms such as Profitus have become an attractive option for many companies seeking funds to pay real estate tax. The borrowing process is often faster and more flexible than through traditional financial institutions, allowing companies to access necessary funds quickly. These platforms also help companies manage cash flow and maintain financial stability even in challenging situations.

Frequently Asked Questions About Real Estate Tax

Both individuals and businesses face various uncertainties when it comes to real estate tax. Below, we will answer the most frequently asked questions.

How Is Real Estate Value Determined?

Real estate value is determined through mass valuation based on Real Estate Register data. The exact taxable value can be checked in the RC extract.

Who Must Pay Real Estate Tax?

All individuals and legal entities whose property exceeds the established non-taxable thresholds or whose property purpose is subject to general taxation must pay real estate tax.

Do I Have to Pay Tax on My First Home?

Tax on a primary residence is payable only if its value exceeds EUR 450,000. Only the amount above this threshold is taxed.

Is Tax Payable on Rental or Investment Property?

Yes. Rental and investment property is subject to a lower non-taxable threshold of EUR 50,000, after which progressive rates apply.

Is Tax Payable on Commercial Premises?

Yes, commercial premises are subject to real estate tax.

Why Is Real Estate Tax Paid?

The tax is paid to supplement municipal budgets, improve local infrastructure, and encourage efficient use of real estate.

From What Amount Is Real Estate Tax Calculated?

For individuals, tax is calculated on the amount exceeding EUR 450,000 for a primary residence or EUR 50,000 for other property. For companies, tax applies to the entire property value using the municipal rate.