COMPANY IN POLAND

The Republic of Poland is a country in Central Europe that demonstrates record economic growth rates year to year. The state is a member of most international organizations (UN, EU, NATO, and WTO), while maintaining its own uniqueness and geographical proximity to the CIS. Poland actively cooperates with 89 countries and has signed agreements on the avoidance of double taxation with them.

Poland provides significant benefits and many organizational and legal forms for businesses; two of them deserve special attention:

• LTD (Spolka z ograniczona odpowiedzialnoscia). The founder can be either one or several persons. In this case, the resident status is optional. The minimum authorized capital is 5,000 PLN. About 80% of all Polish companies are LTD;
• JSC (SA Spolka Akcyjna). Joint-stock company, which provides for having only 1 founder shareholder. The minimum authorized capital is 50,000 PLN.

Poland opens up its business potential for foreigners: any non-resident can register a company in the country and manage it solely.

Specifics of the company registration in Poland

National Court Register (KRS) is an authority that registers companies in Poland and stores information about commercial entities. The status of a legal entity and an identification tax number are assigned during this procedure.

There have been two registration methods available in Poland since 2018:

• electronic;
• traditional.

The opportunity has opened up for foreign businesses and entrepreneurs to register a company remotely — there is no longer any need to perform actions physically in Poland. Another advantage of electronic registration is that it takes only 3 business days.

All you need to open a business in Poland is to prepare the documents and sign them on the website of the Ministry of Justice using a digital signature (EDS). The EDS can be obtained in two ways:

• if you have a residence permit in the country and a PESEL number, you can use the ePUAP service. To do this, you need to activate the profile in this service by visiting the identity verification point. This procedure will take 14 days;
• persons who reside outside the country can contact Cortax. We will arrange for a PESEL number and apply to activate your profile in ePUAP for you. Only a power of attorney will be required. You can confirm your profile at the Polish consulate in any other country.

Documents for registering a company in Poland

In addition to the power of attorney and the application, starting a business in Poland will also require the following:

• memorandum of association;
• company charter;
• applications for the KRS;
• receipt for payment of the court fee;
• receipt (check) for payment for the announcement in the newsletter.

All the above documents must be translated into Polish and notarized — Cortax experts can help with this. Based on the results of registration, the company receives its identification number, and the founders receive their TIN.

What founders need to know about registering a business in Poland

Polish law establishes the following rules that every foreign entrepreneur must remember:

• founders can be either individuals or legal entities;
• information about the founders is publicly available;
• no deposit of the authorized capital to a bank account during registration is required;
• details about the owners must be submitted to the register within 7 working days after the company registration;
• company name must be in two languages: Polish and English, followed by the Sp. z o .o abbreviation;
• lease agreement for a legal address must be concluded before registration;
• fixed capital can be deposited at the company cash desk.

No special certificates of the procedure completion are issued after registration – information about the company is recorded in the KRS, after which the company is ready to operate. However, it is required to deposit the authorized capital into the bank account before the launch.

Specifics of taxation in Poland

Polish law establishes the following taxes for businesses:

• corporate tax (CIT). The base rate is 19%. There are preferential rates: the rate will be only 9% for a new business over the first year (with a turnover of up to 2 mln Euros). The rate will be zero if the profit is reinvested (for companies with a turnover of up to 50 mln PLN);
• VAT. The base rate is 23%. There is no need to register as a VAT payer, if the company's annual income is less than 200 thous. PLN;
• income tax. The base rate is 18%. The rate increases to 32%, if income is more than 85,529 PLN;
• mandatory contributions. Social and medical taxes are up to 22.41%;
• dividend tax. The base rate for non-residents is 19%.

The minimum wage in the country, which is 450 Euros per month, also must be taken into account. Additional costs include contributions to the insurance fund, which is 64% of the net amount.

If you wish to open a business in Poland, the Cortax team can help you with the translation of documents and the preparation of all necessary applications. We advise non-residents and disclose all the advantages of company life in one of the most developed countries of Central Europe.