Real Estate Tax Changes for Legal Entities in Lithuania from 2026

The real estate tax changes that entered into force in Lithuania at the beginning of the year also significantly affect the tax environment for legal entities.

Real estate owned by legal entities is subject to municipal tax rates ranging from 0.5% to 3% of the taxable value. At the same time, municipalities retain the right to apply higher rates of 1% to 5% to abandoned or poorly maintained real estate. In addition, from 2026, certain categories of real estate will be subject to an additional 0.2% tax rate, calculated together with the rate set by the municipality.

As a result, the actual tax burden may increase even if the municipality does not revise its existing tax rate.

The tax base continues to be determined based on the taxable value calculated by the Centre of Registers. From 2026, taxable values will be updated more frequently – at least once every three years. This means that even without changing the purpose or use of the property, its taxable value – and consequently the payable tax amount – may change.

For this reason, legal entities are advised to regularly review the data recorded with the Centre of Registers and assess potential tax implications for their budgets.

The classification of real estate as abandoned or poorly maintained becomes a particularly sensitive issue for legal entities. Properties included in the municipal register of abandoned or poorly maintained real estate may be subject to tax rates of 1% to 5%. Such status is assigned where property maintenance obligations are not fulfilled, construction is not completed within the statutory timeframe, or buildings are not maintained in accordance with applicable legal requirements. In practice, this entails not only an increased tax burden but also heightened regulatory and reputational risks.

It is important to note that not all real estate owned by legal entities qualifies as an object of real estate tax.

Unfinished and factually unused real estate is not subject to real estate tax if no more than ten years have elapsed since the issuance of the construction permit, and if updated cadastral data reflecting changes during construction were submitted within five years from registration in the Real Estate Register. Real estate created or acquired under public–private partnership arrangements is also exempt from taxation for the duration of the partnership agreement, provided the property is used in accordance with its designated purpose.

From an administrative perspective, legal entities remain obliged to self-assess and declare real estate tax. The annual tax return must be submitted using form KIT719, while in certain cases – where the payable tax exceeds the statutory threshold – advance real estate tax payments must be declared and paid using form KIT711. Advance payments are made for three quarters of the tax year, making real estate tax planning a matter not only of year-end compliance but also of ongoing cash flow management.

From 2026 onwards, real estate tax for legal entities is shaped not only by applicable tax rates but also by a systematic approach to real estate as an actively managed asset. Companies that proactively review their real estate portfolios, verify taxable values, assess property status, and ensure the accuracy of registry data are generally better positioned to avoid unexpected tax increases and administrative disputes with municipalities or the tax authorities.