One of our main areas of expertise is related to coprporate establishment advisory. We help foreign investors in choosing the most suitable form of activity in Poland and guide them through the establishment process.
Corporate establishment advisory
- Why should you choose CGO Legal?
- Types of companies
- Which legal form to choose?
- Taxation
- The registration process
- Basic facts about company in Poland
- Registration fees
- Steps after incorporation process
- Meet our expert
Why should you choose CGO Legal?
Our corporate department has provided legal services to over 1.000 clients. We helped them in company formation in Poland – if you want to take advantage of our experience and expertise feel free to. We assist with:
- setting up subsidiaries, branches, and representative offices of foreign business entities in Poland
- efficient structuring of your venture from a legal and tax point of view
- preparing bespoke drafts of deeds of association
- registration of companies in the National Court Register
- preparing a full set of corporate documentation
- assuring legal and tax compliance with Polish law
- providing 360 degree ongoing help to our clients in the fields of law, global mobility and hr and accounting services
Types of companies
Polish legal system names following company types:
Partnerships
- Registered Partnership [sp.j.],
- Professional Partnership [sp.p.],
- Limited liability Partnership [sp.k.],
- Limited Joint-Stock Partnership [s.k.a.]
Capital companies
- Limited Liability Company [sp. z o.o.],
- Joint-Stock Company [s.a.],
- Simple Joint-Stock Company [p.s.a.]
Foreign entrepreneurs can also decide to register a representative office or a branch of their foreign company in Poland.
Which legal form to choose?
In 2023, our recommendations for the clients will still depend on their developed or assumed business models. There is no doubte that since the implementation of the Polish Deal there is no one business form that would be profitable for all entrepreneurs. Previously, a limited liability company and a limited partnership constituted such solutions. Still, we can assume in broad terms that:
- for “start-ups” we will recommend an LLC or a simple joint-stock company;
- for profitable service activities (with a low level of investment) we will recommend a limited partnership;
- for businesses in which a significant part of the income is reinvested, we would recommend an LLC, preferably together with Estonian CIT
Taxation
Corporate tax rates in Poland
According to Article 19 of the CIT Act, the tax rates of companies in Poland are subject to corporate income tax at a rate of:
- 9%Applies to “small taxpayers”
- 19%Applies to other taxpayers
9 % CIT
After fulfilling certain conditions, CIT taxpayers may benefit from preferential tax rates for companies in Poland. Due to many factors that determine its implementation, the reduced 9 % tax rate does not apply to all taxpayers. The CIT Act identifies that the preferential tax rate may be available for those who have small taxpayer status. It may also cover new taxpayers who may benefit from the tax relief. Of course in the first fiscal year of their activity.
A small taxpayer is defined as a business entity whose value of sales revenue did not exceed of 2 million EUR. It counts for the previous fiscal year. The amount is converted based on the average rate announced by the National Bank of Poland as of the first business day of October of the previous year, rounded to 1.000,00 PLN. In the case of small taxpayers, the CIT model assumes a 9% rate to revenues excluding capital gains.
The registration process
Step 1. You have to decide on a type of company you want to incorporate.
Most (over 90%) foreign investors choose Polish Limited Liability Company (Sp. z o.o.) to start operating in Poland. However, particular features of your project may lead to different choices. There are many advantages of this form of economic activity. Among them you can find limited liability for the company’s debts (unlike partnerships) or low initial share capital (5.000 PLN). There is also a tax incentive – low corporate income tax (9% for start-ups and 19% for companies with turnover exceeding EUR 2.000.000). The other thing is that the Polish limited company requires only one shareholder.
Step 2. You need to provide us with key information about of your company such as: (company name, share capital, representation, etc.).
Step 3. You have to gather and provide us with required documents
I. If shareholders are individuals
- copy of ID of the shareholders
- duly legalized power of attorney (if you want to incorporate a company without visiting Poland)
II. If shareholders are legal entities (e.g. foreign company, foundation)
- an official extract from your local register of companies proving that the company is operational and providing information on who is the legal representative of the company
- mother company’s statute/memorandum of incorporation
- ID/passport of the persons which will become board members in the Polish company
- ID/passport of the persons representing the mother company
Procedure and timing
We will have to collect the necessary documentation to prepare a complete application for the company incorporation. Upon registration, the Limited Liability Company in the organization will become a regular LLC. It also acquires legal personality. The estimated time for incorporation of a Limited Liability Company in Poland is 3-8 weeks. This starts from concluding the articles of the association until the entry to the register.
Stage 1 – Sign the articles of incorporation of a limited liability company
The shareholders or the legal representatives of the shareholders sign the company’s statute. This needs to be done before the Polish notary public as the form of a notarial deed is required for the agreement to be legally binding.
Stage 2 – Deposit the share capital of Polish company
The amount of money which will cover the share capital of the company must be deposited to the company’s bank account or in cash. You should transfer to the company all the in-kind contributions mentioned in the articles of incorporation.
Stage 3 – Appoint a management board
The company needs to have legal representatives to be operational and even to get registered. The body authorized to represent a Polish Limited Liability Company is the management board. It consists of at least one member.
Stage 4 – File a motion for incorporation to the Polish register of companies (KRS)
A motion using a particular form should be filed to the commercial court relevant to the place in which the company is headquartered. You can also do it through a power of attorney given to a professional.
Stage 5 – Meet regulatory requirements
The acitivity you decided to perform in Poland may need some specific licenses or permits. To check whether you are compliant with Polish regulations contact your law firm.
Basic facts about company in Poland
| Minimum share capital for JSC | 100 000 PLN |
| Minimum share capital for LLC | 5000 PLN |
| Time frame for the incorporation | 4-6 weeks (online 3-7 days) |
| Company name verification | Not required, recommended |
| Available incorporation methods? | Traditional at the notary, or online via designated portal |
| Minimum number of shareholders for LLC | 1 |
| Can foreign citizen be a shareholder of the Polish company? | Yes, there are no limitations as per the nationality of the shareholder |
| Can the director be a foreigner | Yes, there are no limitations as per the nationality of the director |
| Is registered address service permitted? | Yes, however it slows down the procedure of VAT number registration |
| Is local director required? | No |
| Corporate tax rates (CIT) | 0% – „Estonian” CIT company not distributing profit to the shareolders 9% – companies with income up to 2 mln EUR 19% – others |
| Dividend tax rate | 19% |
| Standard VAT rate | 23% |
| Tax incentives | IP Box, “Estonian” CIT, R&D tax relief (multiplication of tax decuctibles), Special Economic Zones (tax exemptions) |
| Stamp duty upon business registration | 0,5% on initial capital |
| Business registration numbers | KRS, NIP, REGON VAT, EU-VAT, EORI, BDO |
| Register of companies online | https://ekrs.ms.gov.pl/web/wyszukiwarka-krs/strona-glowna/ |
| Corporate bank account opening | Personal visit of the director required, on special occasions remote set up on the basis of power of attorney also available |
| Electronic signature | Obligatory for each Director of Polish company for the purpose of filing annual financial statements |
| Is Accounting obligatory? | Yes |
Registration fees
If you concluded the company’s agreement in a traditional way, the court fee for entry in the National Court Register amounts to 500 PLN. In such case the fee for announcing the entry in the Court and Economic Monitor is 100 PLN. For the agreements with use of S24 system, the fees are lower. They amount respectively to 250 PLN and 100 PLN for announcing the entry in the Court and Economic Monitor. In both cases there is also an administrative fee required in the amount of 17 PLN if you act via proxy. The payment can be made via the e-Payment system on the website https://oplaty.ms.gov.pl/, you can do it through your own bank account.
Steps after incorporation process
Upon its registration the company obtains tax identification number [Polish: NIP] and statistical number [Polish: REGON]. Within 7 days after incorporation, a new company has to show an actual beneficiary in the Central Register of Beneficiaries. Moreover, the company has to provide the relevant Tax Office with supplementary data, such as a list of bank accounts. You should submit the information on the dedicated NIP-8 form within 21 days following the date of entry into the National Court Register. One should also remember to register the company as a VAT Taxpayer.
In connection with the business registration, the company is required to pay tax on civil law transactions in the amount of 0.5% of the tax base. It is determined by the value of contributions made to a partnership or by the value of share capital of a limited company. The declaration must be made on the dedicated PPC-3 form to the tax revenue office in the area of the company’s seat. The document must be submitted within 14 days following the date of concluding a company’s agreement.
Meet our expert
Jakub Chajdas
Contact an expert
info@cgolegal.com
+48 22 873 79 90
For over 12 years of his work at CGO Group Jakub has been supporting foreign investors in setting up and developing their business in Poland. He provides an allround legal and tax suport for corporations with foreign capital.
Till date Jakub has been trusted by Clients from countries such as e.g. USA, UK, Canada, Italy, UAE, Israel as well as Belarus, Ucraine and Baltic States. In his legal practice Jakub supports entrepreneurs with main focus on IT, HR, production and real estate sectors.
Jakub endorses efficient and comfortable business cooperation. If you are interested in tax and legal matters related to setting up and developing a business in Poland he is the person you should contact with. Jakub provides support both in English and Italian.
