The complete guide to settling utilities for landlords
Settling utilities in rented units is a topic that can give even a seasoned landlord a headache. One flat? Fine, you’ll manage in Excel. But with five or ten units the trouble starts - one mistake on a single electricity bill and you’ve got a tenant calling every other day for the next three months. It is a common scenario in a larger portfolio. In this article I’ll go through the methods for settling operating costs, the tools that help with it, and the legal obligations you need to know to stay out of trouble.
Which utilities does the landlord settle, and who signs the supplier contracts
Before you post a listing, you need to answer one question clearly - which charges fall on you and which on the tenant. Because later, when the final settlement at handover begins, the lack of clear arrangements turns into an argument. Better to sort it out from the start.
Contracts for electricity, gas, water, heating and sewage are signed by the owner. Why? The installations are permanently in the unit, and the supplier needs continuity of the contract regardless of who happens to be living there. You remain the party to the contract with the supplier, and you pass the usage costs on to the tenant - based, of course, on the provisions in the tenancy agreement.
The tenant handles internet, cable TV and the landline themselves. These services aren’t tied to the unit; they can be transferred or terminated without affecting the flat. The tenant picks the provider and package that suit them, which simplifies things for both sides.
- The owner’s side - electricity, natural gas, water supply, sewage, central heating, municipal waste collection, the building community’s renovation fund
- The tenant’s side - broadband internet, cable or satellite TV, landline phone, additional streaming services
- To be agreed in the contract - unit insurance, parking-space fee, access to a cellar or storage room
Tip 1: Always spell out in the tenancy agreement which utilities the tenant pays for and which the owner does - a detailed list eliminates disputes at the final settlement and handover of the unit. It’s worth including a table with supplier names, account numbers and payment deadlines, so the tenant has complete information from day one.
Three models for settling utilities with tenants
The way you settle utilities translates into how much paperwork you have and whether the tenant feels they’re paying fairly. Every model has its pros and cons. And the choice depends on how many units you have, how often tenants change, and whether you have submeters.
Model one - the flat rate. You set a fixed monthly amount based on previous usage and that’s it. No readings, no corrections. Administratively, a dream. But there’s a catch - if the tenant starts doing laundry every day and cranking the heating to the max, you cover the difference out of your own pocket. This model often backfires when renting to students, where usage swings a lot.
Model two - settlement by meter. You read the figures at the end of the period and charge the tenant the exact amount for what they actually used. Fair? Very. Tenants pay more attention to their usage, because they can see it’s their wallet on the line. But you need regular readings, documentation, reconciling balances. With several units, that can eat up a few hours a month.
Model three - the mixed one, and honestly I’d recommend it as a starting point. You cover what can’t be measured separately with a flat rate - central heating, waste collection, the renovation fund. Electricity and water you settle by meter. A balance between simplicity and transparency. It works especially well in multi-unit buildings.
- Flat rate - minimal administrative cost, high risk of losses for the owner, low motivation for the tenant to economise
- Settlement by meter - fair split, demanding documentation, highest tenant satisfaction
- Mixed model - optimal balance of effort and precision, flexibility across different types of utilities
One more thing - the billing periods. Electricity, gas and internet can be settled in shorter cycles when tenants change often. It’s trickier with water, sewage and heating, because suppliers have their own reading schedules and won’t change them to suit you.
Tip 2: With per-room rentals, set a monthly flat rate or settle every month by meter reading - this approach eliminates conflicts when a tenant changes mid-period and ensures continuity of cash flow.
Utility clauses in the tenancy agreement - what has to be there
A good tenancy agreement is one where nothing has to be guessed. The method for calculating charges, the reading dates, the complaints procedure - all of it has to be on paper. Because if you don’t write something down, both sides will start interpreting it their own way. And you can guess how that ends.
Who takes the readings? How often? By what method do they convert usage into zł? You can go down to the cellar with a torch yourself, or ask the tenant to send a photo of the meter (recommended - faster and more convenient). The settlement period - monthly, quarterly, half-yearly - should line up with the suppliers’ billing cycles. Otherwise you’ll be making corrections on top of corrections.
Additional charges, such as waste collection or the renovation fund, should be clearly described in the agreement - how the readings will be taken and who takes them. If the tenant is to bear additional costs, this should be itemised in the document.
The handover protocol - and here’s something you must not skip. The readings of all meters, serial numbers, calibration dates, figures down to the last digit. Photos on your phone. Seriously, those five minutes of taking pictures can save you weeks of grief when the unit is handed back.
- The details of the parties to the agreement and the exact address of the unit with its land register number
- A list of the utilities covered by the settlement, with an indication of the party responsible for each charge
- The method for calculating costs - flat rate, meter readings or the mixed model
- The frequency and method of taking meter readings
- Payment deadlines and the bank account number for utility payments
- The complaints procedure in the event of objections to the settlement amount
- The handover protocol as an attachment, with photographic documentation of the meters
Oh, and an indexation clause for the flat rate. Once a year, an adjustment for inflation or the actual rise in tariffs. Without it, you’ll be amending the agreement every time the supplier raises prices. And they raise them regularly, no point kidding ourselves.
Tools for utility settlements: a spreadsheet and a rental system
Excel and one flat? Sure, you’ll cope. Two units - still fine. But with five you start getting lost in formulas, forgetting reading dates, mixing up bills between tenants. It often happens. That’s when a well-built settlement spreadsheet with a history of readings for each unit helps, together with a rental management system that looks after the rest: agreements, rent, documents and deadlines.
A rental management platform such as Tenanto does not calculate utilities, but it keeps everything around them in order. You record utility information in the building record, providers’ invoices and handover protocols with meter readings go into the unit’s documents, and rent and deposits come with an automatic email reminder. Everything in one place, no hunting through folders.
How much does it cost? In the Tenanto price list, the first unit on the Indywidualny plan costs 0 PLN, each further one 15 PLN net a month, Biznesowy 99 PLN net for up to 10 units, Professional 249 PLN net for up to 100 units, and Enterprise 499 PLN net with no unit limit. With one flat you pay nothing, and five units come to 60 PLN net a month.
Ten flats fit in the Biznesowy plan for 99 PLN net a month, and a portfolio of up to 100 units in the Professional plan for 249 PLN net. With fifteen or twenty units, the cost of the tool is a fraction of what you could lose on a missed agreement end date or a lost protocol.
And invoices? This is where the National e-Invoicing System (KSeF) comes in. KSeF imposes the obligation to issue structured electronic invoices - and that applies to landlords operating as a business too. You can issue utility re-invoices in invoicing software, through your accountant or in the free KSeF Taxpayer Application, whatever tool you use to manage the tenancy.
Tip 3: When managing more than three units, split the work: calculate utilities in one spreadsheet with a history of readings, and run agreements, payments and documents in a rental system. The time saved can go into growing your property portfolio.
The landlord’s tax and legal obligations when settling utilities
This is where it gets serious. You need to know whether re-invoiced utilities increase your tax base or whether it’s just passing a cost on to the tenant. Get it wrong? Tax arrears, interest, penalties. The tax office doesn’t accept “I didn’t know” as an excuse.
A lump-sum tax on recorded revenue - this is the most commonly chosen form for private rentals. Up to 100,000 zł a year you pay 8.5%, above that - 12.5%. But watch out with utilities. If you collect the exact amount from the bill from the tenant and pass it to the supplier - that money may not increase the lump-sum tax base. But if you bundle utilities into a flat rate included in the rent, the whole amount counts as taxable revenue. The difference can be substantial.
Since 28 April 2023, before signing the agreement you must give the tenant an energy performance certificate. This applies both to renting out a whole flat and individual rooms. Don’t have this document? A fine of up to 5000 zł, and the tenant can also seek compensation for inflated heating costs. Not worth the risk.
Renting through a business? Don’t forget about VAT. A commercial unit let to a tenant using it for business - 23% tax on the rent and on the re-invoiced utilities, under the Polish VAT act. Renting a flat for residential purposes, on the other hand, is exempt from VAT. This difference matters a great deal when calculating the total cost of the rental.
The year 2026 brings potential changes - modifications to the lump-sum tax rules and the full rollout of KSeF could complicate the way rental revenue is documented. I recommend monitoring the legislative work as it develops and, if in doubt, consulting a tax adviser. It works out cheaper to ask beforehand than to put things right afterwards.
Frequently asked questions (FAQ)
Can the landlord charge the tenant for all utility costs?
Essentially yes - the principle of freedom of contract gives you plenty of room to manoeuvre here. Electricity, gas, water, heating, waste collection, even the renovation fund - you can pass all of it on to the tenant. But there’s a condition: you have to spell it out precisely in the agreement. Specific items, the calculation method, payment deadlines. Without that, any attempt to enforce the charges falls apart, especially when the matter ends up in court. And you don’t want it to.
How do you settle utilities in per-room rentals when there are no separate submeters?
No submeters in the rooms? A standard situation, especially in older buildings. The simplest way out - a proportional flat rate. You take historical usage and divide it equally between tenants or in proportion to each room’s floor area. You can also split the total bill each month by the number of occupants. But seriously - if you have frequent turnover (and with rooms you usually do), consider fitting electricity submeters in every room. A one-off expense that eliminates most of the arguments about a “fair” split.
What do you do when the tenant disagrees with the utility bill amount?
No panic. Documentation is your best friend. Step one - show the tenant copies of the supplier invoices and a detailed calculation of how you arrived at their amount. Disputing the meter reading? Order a control reading from the supplier or through an independent expert. The handover protocols from the start of the tenancy (the ones I wrote about earlier) give you a reference point for verification. And if you still can’t reach an agreement - mediation through a consumer organisation or a court mediator. Faster and cheaper than court.
How to settle utilities without disputes with tenants
A good agreement settles most of the problems with utility billing. The calculation method, the reading dates, the complaints procedure - clearly and specifically on paper. A handover protocol with photos of the meters closes the “but how much was it at the start” question. Simple? Simple. But you’d be surprised how many owners skip it.
The settlement model has to be tailored to you. One flat rented to a family for years? A flat rate is enough. Ten units with students who change every semester? There you need a system of readings, a decent spreadsheet and a tool that keeps track of agreements and documents. The mixed model - a flat rate for utilities without submeters plus settlement of electricity and water by meter - is a universal compromise that works in most cases.
A SaaS rental platform where the first unit costs 0 PLN and each further one 15 PLN net a month won’t calculate utilities for you, but it keeps the agreements, rent, protocols and deadlines around them in order. With several flats, that’s a real time saving and - perhaps even more valuable - operational peace of mind.
And finally - the law. The energy performance certificate, KSeF, the changes to the lump-sum tax. These regulations directly affect how you document and settle utilities. A landlord who keeps a finger on the pulse of tax and legal matters not only avoids penalties but also builds a professional image in the eyes of tenants. And a good reputation in this business? Priceless.
