Register a company in Poland

Register company in Poland with PLA.partners!

Poland, officially the Republic of Poland is a country located in Central Europe. It is divided into 16 administrative provinces, covering an area of 312,696 square kilometres with a population of nearly 38.5 million people. Poland is the fifth most populous member state of the European Union. A land of striking beauty, Poland is punctuated by great forests and rivers, broad plains, and tall mountains. The country’s capital is Warsaw, here you will find modern buildings and historic architecture, which was heavily damaged during World War II. However, great efforts were put to the restoration of Poland’s capital. Other cities in Poland which are well recognized are:

• Poznań which is an important cultural and business centre and one of Poland’s most populous regions with many regional customs such as Saint John’s Fair (Jarmark Świętojański), traditional Saint Martin’s croissants and a local dialect;
• Gdańsk, one of the most active ports on the busy Baltic Sea; and
• Kraków, a historic centre of arts and education and the home of Pope John Paul II.

There are a lot of investors interested in starting a business in Poland.

Company formation in Poland – types of companies in Poland

Company formation in Poland is increasingly popular among foreign investors. The reason for this popularity is that international reports highlight the economic and political stability of Poland, educated and competent human capital and a large domestic market. Foreign investors willingly proceed with company registration in Poland treating it as a safe heaven in times of economic instability.

You may set up a company in Poland in various forms:

• limited liability company – the most popular form of company established by foreigners in Poland. It is the most suitable business form for small and medium sized companies, having a minimum share capital of PLN 5.000. There are no restrictions as to the nationality and residency of directors and shareholders. Company is subject to CIT.

Shareholders of a limited liability company have following rights:

• right to participate in the General Meeting of Shareholders,
• right to sell shares,
• right to vote and receive profit;
• right to supervise the company’s activities,

Shareholders have also certain obligations:

• pay in money or contribution in kind required to pay up share held by this shareholder;

• Some things to consider when deciding to incorporate a limited liability company in Poland:
• * name – must be unique, and not contain any ‘sensitive’ words or phrases – i.e. you can’t use a trademark in your name or pass yourself off as something you’re not. It is worth spending some time choosing the right name for your company;
• * location – you must have an address where correspondence addressed to the company and official mail can be sent. Many entrapreneurs simply use their own residential addresses, or you may decide to use a third-party service (often virtual office address), or even your accountant’s company address for this purpose if such service is provided by your accountant;
• * board members – decide who is to be a member of the board, at least one board member must be appointed. Board members represent the company;
• * shareholders – gather details of the shareholders – name, date of birth, ID number, residential address and how many shares will each shareholder (in more than one) acquire;
• * share capital – minimum share capital is PLN 5.000 but you may decide to contribute higher amount at the time of incorporation, share capital may be paid up by cash or by a contribution in kind;
• * articles of association – decide on the wording of the articles of association. Articles of association among others include: list of the activities of the company, any personal rights (if granted), confirmation how the company may be represented – by each director solely or jointly, amount and value of shares;

* UBO – register beneficial owner(s) in the Beneficial Owners Register. The entities incorporated after 13 October 2019 have 7 business days from the day of their entry into the National Court Register (NCR) to complete the registration in the CRBO. There is also a 7 business days period for submitting notifications to the CRBO in case of any changes to the data previously disclosed therein. The CRBO is an IT system operated by the Ministry of Finance to process data on the beneficial owners of certain entities (in practice, these are almost all companies and partnerships registered in the Polish National Court Register – KRS).

The beneficial owner(s) of a corporate entity other than a publicly traded company may be:

* UBO – register beneficial owner(s) in the Beneficial Owners Register. The entities incorporated after 13 October 2019 have 7 business days from the day of their entry into the National Court Register (NCR) to complete the registration in the CRBO. There is also a 7 business days period for submitting notifications to the CRBO in case of any changes to the data previously disclosed therein. The CRBO is an IT system operated by the Ministry of Finance to process data on the beneficial owners of certain entities (in practice, these are almost all companies and partnerships registered in the Polish National Court Register – KRS).

The beneficial owner(s) of a corporate entity other than a publicly traded company may be:

• any natural person who is a shareholder of the entity and owns more than 25% of its shares;
• any natural person who holds more than 25% of all voting rights in the decision-making body of the entity, including as a pledgee or usufructuary or under agreements with other vote holders;
• any natural persons in control of the entity who jointly own more than 25% of its shares or jointly hold more than 25% of all voting rights in the decision-making body of the entity, including as pledgees or usufructuaries or under agreements with other vote holders;
• any natural person who is the “parent undertaking” of the entity for the purposes of the Accounting Act (meaning, inter alia, that the person has the right to appoint a majority of the members of its management or supervisory body or the right to direct its financial and operating policies).

If no natural person from the above can be identified, or if there is any doubt concerning their identity, natural person(s) holding the position of senior managing official(s) in the organization (e.g. management board members) will be considered to be the beneficial owner(s).

There is a penalty for a failure to meet the deadline provided for in the Act for companies submitting the required information to the CRUBO; it is a fine of up to PLN 1 million.

joint stock company – usually used for a large scale business. A partners in a joint-stock company (a shareholder) only risk the value of capital brought in but not their personal assets. Joint-stock company is a legal entity fully independent from its shareholders. It is a body corporate which can independently act in transactions and is responsible for its own obligations. Shareholders are not liable for company’s debts.

* share capital: min. PLN 100.000;

* legal personality;

* may be established by one or more persons; exception: it may not be established solely by a single-member limited liability company;

* subject to CIT – corporate income tax;

* organs: stakeholders, board members, supervisory board;

* liability of the shareholders: they are not liable for the company’s obligations, they bear a risk up to the value of shares taken up;

* representation: the company shall be represented by the Management Board (consisting of at least one member) in accordance with the principles set forth in the Articles of Association. The company may also be represented by a proxy;

* name: may be freely chosen, it should contain an additional designation “joint-stock company”. The use of the abbreviation S.A. is acceptable:

* accounting: full accounting, publication of annual financial reports and auditing required:

* succession: the joint stock company is born out of the law, so the only way for the company to end is by the functioning of law. So the life of a company is in no way related to the life of its members. Members or shareholders of a company keep changing, but this does not affect the company’s life.

limited partnership – there are two types of partners in a limited partnership. One a general partner bearing unlimited liability for debts and obligations and second a limited partner bearing liability only to a certain amount stipulated in the articles of association called the limited liability amount (suma komandytowa). General partner effectively runs the business and makes decisions on daily basis. Partners’ share in the capital of the partnership generally corresponds to the amount of contribution that was actually made. However, distribution of profits may be set forth in the articles of association in proportions partners agree on.

* no legal personality;

* possess a legal capacity and may in its own name acquire rights, including ownership of immovable property and other rights in rem, incur obligations, sue and be sued;

* the statutes of the partnership should be executed in a notarised form and signed by all general partners;

* entry into the National Court Register (Krajowy Rejestr Sądowy) required;

* each general partner may represent the partnership independently. A limited partner may represent the partnership only as a proxy;

* no minimum capital required;

* contribution in kind and in cash available;

* name: the name (business name) of the limited partnership shall include the name of one or more general partners and the additional indication ‘limited partnership’. It is allowed to use the abbreviation “sp.k.” in trade;

* profit sharing: most often determined by the articles of association. If there are no provisions in the agreement, each general partner’s share shall be equal, irrespective of the nature and value of the contributions, and each limited partner’s share shall be in proportion to the limited partner’s actual contribution to the partnership;

* general partners are liable for the partnership’s debts without limitation by their private assets;

* the liability of limited partners is limited.

Polish civil partnership – the advantage of this form of business is, among others, low cost of establishment and the possibility of having a simplified accounting. Moreover, no capital is required to set up a partnership. However, you need to remember that a civil law partnership does not have legal personality, which means that the partners are responsible for all rights and obligations of the partnership.

Main features:

* established by at least two natural or legal persons;

* no legal personality;

* each partner is jointly liable for the debts and obligations of the partnership;

* each partner has right to represent a company;

* registration: a civil law partnership is not an entrepreneur; all partners in a civil partnership must be entrepreneurs. The partnership itself is not subject to registration with CEIDG or the National Court Register. Partners are subject to registration;

* name: if the partners in a partnership are natural persons, the name of the partnership should include at least the first and last names of all partners together with the name “civil law partnership” or an abbreviation (sc.);

* profit sharing: each partner’s share of the profit shall be equal, regardless of the value of the contribution made. However, this rule may be modified in the contract.

Sole trader – a legal structure without legal personality. As sole trader you alone are responsible, and liable, for the company, its finances and its debts. You can only set up one sole proprietorship in Poland, but you can operate under various trade names, perform different commercial activities and work from multiple premises. No difference is made between your personal and business assets. Creditors are therefore entitled to make a claim on your personal assets. You’ll also have to file for personal bankruptcy if your sole proprietorship is declared bankrupt. If you have a partner, you can prevent them from going bankrupt too by drawing up a (pre)nuptial.

General partnership

The company does not have a legal personality but it does have a legal capacity which means it may carry rights and obligations on its own behalf.

A General Partnership (GP) is an agreement between partners to establish and run a business together. It is one of the most common legal entities to form a business. All partners in a general partnership are responsible for the business and are subject to unlimited liability for business debts.

The ways the profits among associates are distributed may be regulated by the Articles of Association. But in the absence of relevant contractual provisions, each companion has an equal part regardless of the type and value of their contribution.

Advantages:

* process of setting up is simpler, cheaper, and requires less paperwork than forming a corporation;

* may be easily dissolved at any time;

Disadvantages:

* partners face unlimited liability;

* each partner is liable for the actions of the others.

As stated above there several types of companies available in Poland. Each company entail different rights and liabilities of shareholders and board members. They also have different share capital and obligation to have a supervisory board. It is important to make an informed decision before proceeding with company incorporation as to which type of entity to choose. Our experts will help you choose appropriate form, will guide you through the hole incorporation process and will register the company for you in the National Court Register. If required we will also help you with obtaining VAT registration number and any other ancillary formalities if required.

How to register company in Poland?

Registering company in Poland requires several important decisions, which will determine the way your business will look like. First of all you have to choose the form of company. In Poland there are few types of companies, which can be divided into two groups: partnerships and capital companies. Foreign investors decide in most cases to set up capital company in the form of limited liability company. Polish LLC possess legal personality. Shareholders are not liable for company obligations. Polish LLC is subject to corporate income tax (basic CIT rate is 19%, reduced rate for small companies is 9%). In addition, shareholders are subject to dividend tax (tax rate is 19%).

After the decision about form of company is made, you will have to decide in particular about company’s name and determine what your company will do and select the PKD codes that describe scope of company’s activity. 

Traditional way of company registration

Most types of companies in Poland can be registered in two ways. One is traditional and requires drafting articles of association. Depending on the form of company, articles of association must be prepared in the written form or in the notarial form. The Polish LLC’s articles of association must be prepared in the form of notarial deed which means that articles of association must be drawn up and signed before a Polish notary. Shareholder who cannot come to Poland to sign articles of association in front of Polish notary, can grant a power of attorney, which should be also prepared in the notarial form and then apostilled and translated to Polish by sworn translator.

After company’s articles of association are signed, then newly appointed company’s authorized representatives (in case of LLC members of management board) have to prepare motion to the national court register. 

This motion will include company’s articles of association, several other documents required by law such as information about correspondence address of company’s representatives and official forms.

The proceedings in the national court register last about 1 month.

Online company’s registration

In Poland you can also register some types of companies online, in particular that possibility includes limited liability company. Online registration of a company takes place without participation of a notary. The company is registered in the system on the website of the Ministry of Justice of Poland. In this system the draft of articles of association is already prepared and can be modified in a very limited scope. To use the system, you have to create an account and have Trusted Profile or qualified electronic signature.

The advantage of this type of registration is that after motion is delivered to court, provided that information included therein are correct and the motion is paid, the proceeding before national court register is much shorter than in case of traditional registration. In fact, in most cases registration of company takes 2,3 working days. The disadvantage is that as mentioned above, you can change company’s articles of association in a limited way. Of course after registration, company’s articles of association can be changed, but if shareholders want from the beginning tailor made articles of association then traditional registration might be only possibility. 

Cost of registration

When registering company, you cannot forget about court fees. Without paying them the motion to register company will not be processed. The curt fees are not high. Court fee in traditional court registration is PLN 600 and in online registration is PLN 350. 

Additional cost is tax on civil law transactions (PCC). If the notary prepares articles of association, then he is responsible for the collection and payment for this tax. In case your company is registered online you must submit a correctly completed PCC-3 declaration to the competent tax office, calculate the tax and make a payment within 14 days from the date of the execution of a company’s articles of association. The taxable amount is the value of the share capital reduced by the cost of court fees. The PCC tax rate on the company’s agreement is 0.5%.

Also, if the articles of association are prepared in the form of notarial deed, you will have to also pay notarial fee, which value depends on the value of company’s capital. 

Concessions, licenses, permits

Sometimes registering company in the national court register will not be enough to start running business in Poland. Some type of economic activity may require obtaining concession, license of permit. So remember to check whether or not you will be required to report the start of your business to the appropriate institution.

Our service for Polish company registration includes:

Experts of PLA.partners provide all services connected with company incorporation and registration. First of all, we will help you decide which legal form is the most appropriate for you. There are several legal forms available among them you will find:

–       Sole trader – is the most simple form, usually used by individuals who personally provide services. The most important thing to remember is that the sole trader does not only directly run business but is also liable for any debts that arose in connection with this business;

–       Limited liability company – if formed by one or more shareholders, there are no limits as to the nationality of shareholders. There is also another body of the company – the board. The board represents the company and may bind it. The shareholder and director may be the same person, but does not have to be. Shareholders liability is limited up to the amount of the paid up shares held by each shareholder. The board may however in certain circumstances be responsible for company’s debt. There is a minimum share capital of PLN 5.000. The company may be incorporated online or via a notarial deed. The time of incorporation and price differs depending on the way the company is incorporated. Our experts will provide you more information about running of the company, directors’ and shareholders’ liability etc.

There also other legal forms available under Polish legislation and it is important to make an informed decision as to which form to choose before company incorporation.

When proceeding with company registration there are other things that the shareholders have to decide:

–       Articles of association – our team will draft tailor made articles of association for your company. If this is suitable for your needs we may use model articles. Such articles are usually used for online company incorporation, which is time efficient;

–       Name of the company – our experts will check if the proposed name by you is available. There are also some restrictions as to choosing the company name especially when it comes to name of limited partnership or limited joint stock partnership. We will make sure that your company registration application will not be rejected by the court due to the name chosen by you;

–       Share capital – in most companies there is a minimum share capital that has to be established and paid up. However amount differs depending of the legal form chosen by you. Our experts will inform you what is the minimum share capital that needs to be paid up;

–       Activities of the company – the articles of association have to include activities of the company. Those have to be chosen in accordance with Polish Classification of Activities (PKD). The shareholders have to choose main activity. In the articles of association there are no limits as to the PKD codes that may be mentioned but when registering the company up to ten may be stated. 

Besides the wording of the articles of association the shareholders need to choose:

–       Seat and address of the company – if you do not have your own property, our team will help you sign virtual office address agreement or lease property. We will verify the agreement if required;

–       Accountancy services – it is important that proper bookkeeping and filing is done. We may recommend firm providing bookkeeping services and review the agreement that you are asked to sign so that your interest is protected. 

Our experts have wide experience in incorporating and registering companies that is why we will prepare full set of documents including any declarations, forms, statements that are necessary for successful and smooth registration of a company in the National Court Register.   

In Poland in 2020 the register of beneficial owners has been introduced. At the time of registration of a company the beneficial owners of the entity have to be registered. There are very high fines for not registering beneficial owners correctly that is why we will help you with meeting those requirements and will prepare application for registration of beneficial owners for you.

Post-registration steps for a Polish company

Once company is registered in the national court register, formally the registration procedure is over and from that point each company has its own unique number in companies register (“numer KRS”). What is more the taxpayer identification number (“numer NIP”) and National Business Registry Number (“numer REGON”) will be granted to the company automatically and information about those numbers will be provided by competent offices to national court register.  

You will be able to get the information about those numbers (which are used by companies in their everyday activity and in contact with authorities) from national court register which in Poland is fully available online and free of charge. Website https://ekrs.ms.gov.pl/web/wyszukiwarka-krs/strona-glowna/ gives an ability to check entries about every company. After registration you can check whether all the details about you company revealed in the register matches those submitted to the court. 

The disadvantage of this register is that it is only available in polish language. 

VAT REGISTRATION

Companies who want or must be active VAT payers are required to submit a notification to the head of the competent tax office. Registration for VAT is made on the VAT-R form, also for the purposes of reporting to EU VAT.

According the polish law, taxpayer does not have register to the VAT if sales value do not exceed the total amount of PLN 200,000 in the previous tax year. In a year when you start activity in Poland, this limit is taken into account proportionally to the period of the year in which you have conducted business activity. But it should be noted that polish regulations also provide a catalogue of activities, the performance of which excludes the possibility of taking advantage of the VAT exemption for low sales value, for example in case of deliveries of new means of transport. 

Each company has to remember also that if there will be a change in information that were included in VAT-R form, the update of this information is required. Such update is free of charge. 

Taxpayers are required to register for VAT purposes before making the first taxable activity, i.e. before making the first supply of goods to their contractors or the performance of a service. 

ACCOUNTANCY  

Most type of companies in Poland (with few exceptions as to the partnerships) have to run full accountancy and prepare financial statement after each financial year. That will require hiring an internal accountant or founding an accountant firm as accounting records must be maintained in both Polish language and currency. The accounting period lasts 12-months and is usually the same as a full calendar year.

BANK ACCOUNT 

Polish entrepreneurs are obliged to have and use bank account in their transactions whenever a party to the transaction from which the payment results is another entrepreneur and the one-off transaction value, irrespective of the number of payments resulting therefrom, exceeds the equivalent of PLN 15,000. That means that being an active entity and making payments will require having an active bank account. The necessary documents for opening a bank account in Poland are primarily documents regarding the company such as excerpt from national court register and documents confirming the identity of company’s representative. 

Each bank has its own procedure and documents that will be required to open a bank account. Though in last year’s polish banks have more foreigner friendly policies and work towards enabling remote opening bank accounts, in most cases it is still required to have at least one personal visit in the bank.

REGISTER OF BENEFICIARIES

Last but not least, each company cannot forget to fulfill its obligations with regard to the making entries in register of beneficiaries. This obligation must be fulfilled within 7 days after company is registered in national court register. Almost all the types of companies in Poland are subject to mandatory entry in the register of beneficiaries, except for partner companies and public joint-stock companies. 

Entries to the register of beneficiaries can be made only by a person authorized to represent company, in accordance with the rules of representation applicable in the company. It is very important that entries cannot be done by company’s proxy. 

Failure to comply with this obligation may result in an imposing a fine on the company of up to PLN 1 million. Making an entry in register of beneficiaries is free of charge and takes place only electronically via register website. The application can be signed by using the Trusted Profile (Profil Zaufany) or qualified electronic signature. 

If as a company representative you don’t have any of them, you should consider obtaining them as in Poland you can handle (or sometimes even have to) an official matter online via website biznes.gov.pl or another administration service and in order to that Trusted Profile or electronic signature is required. 

Frequent Asked Questions about Polish Company Registration