Poland is located in the heart of Europe, in the neighbourhood of Russia, Ukraine, Lithuania, Slovakia, Czech Republic and Germany. For several decades, the business climate and economic competitiveness of this country have been getting better and the domestic market has been strengthening and growing. Business activity in Poland is fuelled by one of the lowest corporate income tax rates in the EU. Together with the mild tax climate, the convenient business incorporation procedure, as well as an accessible and skilled labour force should be mentioned.
As already emphasised, the profits of some Polish companies are subject to corporate tax at a very moderate rate of 9%.
A business with a complex corporate structure, such as a general partnership, is able to pay less tax because the profits of such an organisation are taxed on a pass-through basis.
The Polish Tax Service sees no fundamental difference between local companies and Polish companies with the participation of foreign investors. However, the latter always have the opportunity to optimise their tax expenses with the help of Poland’s numerous double tax treaties with other countries.
The national government uses tax incentives as a tool to support ultra-small, small and medium-sized businesses. For example, reduced corporate tax rates can be applied when a company conducts R&D work.
In Poland, foreign investors have exactly the same opportunities as local entrepreneurs. By opening a company, a foreign businessman can also apply for state grants and subsidies.
And if a firm registers in one of the special economic zones, the investor can use a favourable tax regime, as well as hire qualified local specialists for a reasonable fee and use convenient business infrastructure.
Moreover, in order to increase the investment attractiveness of the state, the government introduced the Polish Investment Area programme. The Polish Investment Area allows certain firms with foreign capital to receive tax deductions on income earned throughout the country. Generally, the amount of the tax credit depends on the area of investment and is inversely proportional to the size of the company.
The Republic of Poland is an integral part of the European Union and is part of the Schengen area. By registering a company in this country, you will have the opportunity to sell your goods and services on the huge solvent European market.
Polish financial institutions are characterised by high reliability and an equally high level of digitalisation. Banks and governmental financial institutions in Poland do not stop working to find new ways of providing services online. The financial sector of the Polish economy is represented by many small and large banking institutions, allowing each entrepreneur to find the offer that best meets the needs of their business.
Unlike some Western European countries, opening a bank account for a company in Poland can be relatively quick. The vast majority of Polish banks have their own mobile app and/or the ability to manage the account online. Moreover, every self-respecting Polish financial institution has its own telephone line where corporate clients can promptly resolve their question, check the account status or obtain additional information.
Any foreign citizen or company can open a company in Poland. To do so, they will not need to make substantial investments, pay nominal Polish directors or founders, rent an office, hire local employees and set up a “sub-state” in the country of incorporation.
The registration procedure can be carried out remotely. As a rule, it does not take more than 10 days for an experienced businessman. The peculiarities of doing business in Poland allow foreign founders to appoint a special person in the company to conduct business directly at the place of registration.
In order to register a company quickly and cost-effectively, we advise you to contact experienced lawyers. Imperial & Legal will provide all the necessary services to open a company not only in Poland, but also in many other countries.
Polish businesspeople conduct their business as sole proprietors, as members of a partnership or through a suitable corporate structure. Each method has its advantages and disadvantages, so we will look at the most common legal forms for company registration in Poland so that you can make an informed decision.
Spółka z ograniczoną odpowiedzialnością (Sp. z o.o.o. or Spółka z o.o.) — a company with limited liability
A limited liability company in Poland can be registered by one or more founders of any state or taxation affiliation and of any type, be it people, companies, or organisational structures such as partnerships. The only restriction of the Polish authorities is that Sp. z o.o. with a sole founder, this founder cannot be another Sp. z o.o. formed by the same founder.
The liability of the owners and directors for the debts of a Polish limited liability company extends only to their share in the total assets of that company. To open this type of company in Poland, an entrepreneur must have at least PLN 5,000 (that’s $1,250 at the current exchange rate) to pay the authorised capital.
Spółka akcyjna (SA) — joint stock company
Joint-stock companies are chosen to register medium and large businesses in Poland. It is much easier to attract additional investments in this type of commercial organisation.
Registration of a shareholding company requires at least 2 founders, natural or legal persons. The liability of SA shareholders is limited to the amount of their investment in the company. A joint stock company in Poland has the possibility to issue bearer shares in order to sell them freely on the stock market.
The minimum share capital for this type of business is 100,000 PLN (about $26,000), of which ¼ must be paid during the registration process. In addition to the share capital, each Polish joint-stock company has a reserve fund to which at least 8% of the organisation’s annual profit is allocated.
Decisions in SA are made by the management board, the supervisory board and the general meeting of shareholders of the company. The annual financial statements of a joint stock company must be preceded by an audit.
The following types of Polish partnerships are distinguished:
Spółka justa (Sp.j.) — general partnership A general or general partnership is registered by 2 partners, who can be people or companies. The partners are authorised to represent the entire company and manage its affairs. Moreover, they are fully and jointly liable for all debts of the Sp.j. Spółka justa has no statutory minimum founding capital, so it is well suited for small business registration. For general partnerships registered in Poland, the principle of pass-through taxation applies, implying that profits are taxed only after they are distributed to the partners.
In this case, the business is managed and owned by one person. There is also no legal separation between the business and the owner’s personal assets.
After paying income tax, all profits remain at the sole proprietor’s disposal.
This organisational and legal form is often used by small businesses. If necessary, an individual entrepreneur may hire additional staff to assist him or her.
Every entrepreneur in Poland has 2 ways to register a form:
As a rule, registration with the help of a notary is chosen in special cases. For example, when it is necessary to specify in the memorandum of association special conditions of participation in the business of some shareholders, when the company has a complex management structure and the standard charter is not suitable for it, as well as when the business will involve different investment capital.
In all other 95% of cases, online registration is more convenient and faster. It allows you to open a company in Poland remotely, relatively inexpensively and in a short period of time.
In order to make life as easy as possible for enterprising people and, in particular, to simplify the procedure of registering a new company, the Polish government has created convenient online platforms. You can open a company in Poland without leaving your home if you have your own electronic signature.
With an electronic signature, a foreign businessman is able to sign documents remotely. There are 2 ways to sign “electronically” in Poland:
It is easier for a foreign resident who does not reside in Poland to use a private EDS with a private key. If you have a residence permit in this country, for example, a work visa, the best solution is the second option, as the Polish electronic signature will greatly simplify your work. To do this you need:
As an example, we will look at the most common option — online registration of a limited liability company. Up to 95% of foreign business investments in Poland are made through Sp. z o.o.
If you do not speak Polish and are not yet familiar with the peculiarities of Polish corporate law, it is a wise move to seek advice from competent corporate lawyers. With their help, at the first stage you will be able to define the key parameters of your future company:
Organisational and legal form. In our example, it is a limited liability company;
Company name. As in other countries, it cannot repeat the names of already existing commercial organisations and officially registered trade marks. An experienced lawyer will advise you on how to check your company name for compatibility, or will do it for you;
Areas of commercial activity of your company. Each type of business activity in Poland is assigned a PKD code by the authorities. The main task is to find on the official website those PKDs that are as close as possible to the future work of your organisation. The founder of a Polish company can choose up to 7 types of business activities, 1 of which must be the main one;
Authorised capital. As already mentioned, the minimum amount of the authorised capital for Sp. z o.o. must be at least PLN 5,000. As a rule, the founders of the company make the respective cash contributions to a special bank account. However, depending on the agreement between the shareholders, the transfer of rights to immovable or movable property to the company may be considered as a contribution to the authorised capital;
Information about the management and founders of the company. It is standard practice to call a shareholders’ meeting to appoint a director or form a board of directors. If the company has one founder, the director is appointed by the founder’s resolution. The minutes of the general meeting of shareholders do not need to be notarised — a written document is sufficient. In Poland, there are no rules requiring the appointment of a permanent resident of the country as one of the directors, so the board of directors may be composed entirely of foreign citizens and companies;
At the preparatory stage, the shareholders also agree on how the company’s profits will be distributed in the future. Issues related to the procedure for exiting the business and introducing new founders are clarified;
The company’s registered office in Poland. You must be able to respond promptly to official correspondence sent to your company’s registered office, even if you only rent it for registration and conduct your business activities in a completely different location.
At this stage, the articles of association of the limited liability company or the memorandum of association, if the company is opened by a single founder, should be drawn up and signed.
When the founders agree on all the organisational aspects of the company, appoint the management, find a suitable office in Poland for registration, draw up and sign the statutory documents, the new company is actually considered to be open. However, without official registration in the KRS (Provincial Court Register), tax and statistical registration, it will not be able to start working.
Fortunately, the digitalisation of document management in this country has reached such heights that it takes literally days to officially register.
First you will need to upload all your company’s documents to the Polish online system S24, where an account is created beforehand. It is desirable that the uploaded documentation is additionally “electronically” signed by the founders using personal EDSs or confirmed profiles in the Polish ePUAP system.
The uploaded documents together with the application for registration are sent to the KRS. There is a fee for processing the application and registering the company with the Polish court — you will need to pay the fee (PLN 350) and the court fee by bank transfer.
The court at the place of registration considers the application and accompanying documents within 3-7 working days. The decision-making period depends directly on how correctly the documents have been drawn up. Professional legal support at every stage of company registration practically eliminates the possibility of mistakes.
If your application is approved, your Polish company will receive an individual number in the KRS register and from that moment it will be considered officially registered with the court.
In the fourth stage of opening a limited liability company in Poland, it is registered with the tax office and the statistical office. In other words, the company is entered into 2 more registers, where it receives 2 more unique identification numbers:
NIP (for the Internal Revenue Service);
REGON (for official statistical offices).
If you are starting a trading company, you will need a VAT registration and a VAT number. If your products will be sold outside Poland in EU countries, you will need to obtain an EU VAT number.
In addition, if your business is regulated by the government, you will need to obtain a licence and/or permission from the local authorities before you start work.
In order for your Polish company to operate successfully, you will need to open a current account with a Polish bank and create an account with one of the electronic international payment systems. Unfortunately, if your commercial organisation requires a bank account in Poland, foreign founders will have to come to the country in person to meet with bank representatives. The problem is successfully solved if the company’s statutory documents allow you to appoint a “procurator” who will help you open a corporate account with a Polish financial institution.
A “procurator” is a natural or legal person located in Poland, authorised to represent the interests of the founder of a company, but who has no share in the company and therefore has no claim to its assets. As a rule, the “procurator” is prescribed in the organisation’s statutory documents. This person or company can help foreign founders to successfully solve a lot of tasks at the place of registration of their company, and especially those tasks that require personal presence in the country. For example, the procurator can open a current account for your company in a Polish bank.
However, when appointing a “procurator”, you must not forget that:
By opening a corporate account for a company, this individual or legal entity also gets full access to it;
“Procurator” can check out at any time, just as you can check him out of the firm’s articles of incorporation at any time.
You should consider the Polish “procurator” as a third party with whom you must agree the terms of co-operation in advance and strictly in contractual form.
Polish corporate income tax is 19%.
The reduced corporate tax rate of 9% applies to all but capital gains, income of companies registered in Poland if tax resident:
In the reporting period received sales revenue (including VAT in this amount) of less than €2 million;
Only a year since he started his business and this is his very first reporting period.
Note: the 9% corporate rate does not apply to the income of new Polish companies formed as a result of restructuring or merger.
On 1 January 2024, Poland applies a minimum income tax rate (10%) to those business structures that have declared losses or insignificant income (≤2% of the proceeds).
At the level of founders, depending on the type of your business organisation, double, pass-through and mixed taxation applies in Poland.
Double taxation implies that corporate tax will be charged on the company’s declared profits, while at the private level the founder registered as a Polish taxpayer will pay tax on his dividends.
Pass-through taxation allows a company to avoid paying tax on income earned, as tax liabilities are passed on to the partners after the distribution of profits between them. It is applied in a Polish general partnership.
The mixed type of taxation does not exempt a partnership from corporation tax, but it does exempt some of its founders from dividend tax.
To ensure that the process of launching a new business in Poland does not turn into unforeseen expenses and loss of valuable time, seek advice from our lawyers. Since Imperial & Legal was founded, the key principle of our work has been an individual approach to each client, whether you are an experienced entrepreneur or a newcomer taking your first steps in business.
By opening your Polish company with our experienced specialists, you will be able to realise all the possibilities provided for by law, so that your business activity brings maximum profit!
Although such organisational and legal forms as sole proprietorship and partnership have a number of inherent advantages, according to statistics, businessmen of foreign origin most often register a limited liability company.
Polish companies are well suited for any business activity, as the country has a relatively low corporate income tax rate and the process of interaction between business and the authorities is strictly regulated and for the most part can be carried out online through convenient portals and applications.
Nevertheless, there is a statistic that in recent years foreigners are more likely to register a business on the hospitable Polish soil to:
To trade in Poland and European Economic Community countries;
Provide transport services in the EU;
Sell your goods worldwide through online marketplaces.
A “procurator” is a natural or legal person located in Poland, authorised to represent the interests of the founder of a company, but who does not have a share in the company and therefore has no claim to its assets. As a rule, the “procurator” is prescribed in the organisation’s statutory documents. This person or company can help foreign founders to successfully solve a lot of tasks at the place of registration of their company, and especially those tasks that require personal presence in the country. For example, the procurator can open a current account for your company in a Polish bank.
However, when appointing a “procurator,” you must not forget that:
“Procurator” can check out at any time, just as you can check him out of the firm’s articles of incorporation at any time;
Even if your company registered in Poland does not have an economic presence in the place of its foundation, you will still incur small regular expenses related to accounting and renting a registered office.
Accounting support for Polish small business companies costs $110-160 per month. Renting a legal address in Poland costs $350-400 per year.
This term conceals the Central Register of Final Beneficiaries in Poland, already discussed in our article, which contains data on all commercial enterprises officially registered in the country and their owners.
Polish authorities consider it an unacceptable blunder when a firm enters into a contract with a counterparty without checking whether its owners are on the CRBR – the “white list of entrepreneurs”.
CRBR stands for Centralny Rejestr Beneficjentów Rzeczywistych – central register of beneficial owners of companies. It appeared in Poland as a result of the entry into force of the EU directive regulating measures to combat the laundering of illicit proceeds.
As the name suggests, the CRBR hosts personal data of individuals with significant control in companies officially registered in the country.
The entrepreneur or his legal representatives must submit the beneficiary data to the registry no later than 7 days after the official registration of the company with the KRS.
Prosta spółka akcyjna – a relatively new type of corporate structure introduced in Poland in 2021. It is intended for ambitious entrepreneurs who do not have sufficient funds to pay the authorised capital to open a limited liability company or an ordinary joint stock company.
In a simple joint-stock company, authorised capital and share capital are different concepts. At the same time, in the process of setting up a company, share capital can be contributed as authorised capital, which at the initial stage may amount to a symbolic sum.
In order to attract additional investment, PSA shares are transferred to new shareholders but, at the same time, they cannot be freely traded on the stock market.
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