Company Formation in Poland

Advantages of Company Formation in Poland

• Low tax rates

  Poland offers relatively low tax rates. For example, the corporate income tax rate is 19%, which is already low. In 2019, a new law introduced an even lower 9% rate applicable in certain specified cases, making it one of the lowest in the EU.

• Simplified residence permit process

  Registering a company in Poland can significantly facilitate obtaining a residence permit. By meeting all requirements, founders can remain in the country to develop their business, with the option to acquire citizenship in the future.

• Fast company registration

  A company in Poland can be registered within just five days once all documents are submitted to the registration authority. The process is streamlined to save time and effort.

• 100% non-resident company ownership allowed

  Poland has no residency requirements for founders or company participants. A company can be fully owned by non-residents, making the registration process straightforward. There is no need to involve Polish partners.

• EU membership

  Registering a company in Poland provides access to the European market and expands business connections. EU legislation, together with Polish national law, creates a reliable legal framework for dealings with counterparties.

• Low minimum share capital

  The minimum share capital in Poland is approximately EUR 1,200 (subject to exchange rates), which is low compared to other EU countries.

Legal Forms of Companies in Poland

Company formation in Poland begins with choosing the legal form. The most popular types include:

1. Limited Liability Company (Spółka z ograniczoną odpowiedzialnością or Sp. z o.o.). Participants are not personally liable for company debts beyond their contributions.
2. Limited Partnership (Spółka komandytowa). This form includes general partners and limited partners, where the latter do not participate in management.
3. Joint-Stock Company (Spółka akcyjna). The share capital is divided into shares. There are public (open) and private (closed) joint-stock companies in Poland.

Company Formation in Poland: the Procedure

Detailed guidance on registering a company in Poland, required documents, post-registration steps, and more can be found on the Polish Government Business Portal.

To start the registration process, identification documents for all company participants are required (consult specialists for specifics), as well as the following information:

1. 2–3 proposed company names in order of preference;
2. Company structure (who will be directors, shareholders, and beneficial owners);
3. The intended business activity of the company.

Once all necessary documents and information are provided, the registration process will begin immediately. The entire process—from gathering registration documents to preparing the final corporate document package—includes the following steps:

1. Checking and selecting an acceptable company name. The name verification process takes no more than one day;
2. Preparing forms and documents for submission to the National Court Register. Special attention must be given to the company’s Articles of Association, as registration cannot proceed without them;
3. Company registration procedure. The registration typically takes 5–10 business days from the submission of all required forms and documents to the Register;

4. Assignment of a NIP number. After company registration, a tax identification number (NIP) will be automatically assigned;
5. Preparation of the company’s constitutional documents and production of a company seal (if needed);
6. Certification and apostille of documents (if required). Certification takes 2–3 days, while apostille processing takes 6–8 days. Poland is a participant in the Hague Apostille Convention;

Company Formation in Poland: Notable Features

• Introduction of a reduced corporate income tax rate in 2019;

  Since January 1, 2019, the corporate income tax rate was reduced to 9% for businesses with 2018 revenues not exceeding EUR 1,200,000. This measure made Poland one of the EU jurisdictions with the lowest tax rates and helped attract investment to the Polish economy.

• Poland’s business environment improves annually.

  Poland is becoming an increasingly attractive jurisdiction for business registration and operations. According to Doing Business data, Poland scored 76.95% for ease of doing business in 2019. Not long ago, Poland did not rank within the top 50 countries for business convenience. In its region, Poland leads in positive reforms over recent years, reflecting strong growth potential.

Corporate Taxation in Poland

Information on taxation in Poland is available on the official websites of the Polish Investment and Trade Agency and the Polish Government. Tax administration is handled by the National Revenue Administration, which can be explored further on the Government website.

Important: Company residency is crucial for taxation purposes. A company is considered a resident of Poland if it is registered in Poland or its management body is located in Poland.

Corporate Income Tax
The standard corporate income tax rate in Poland is 19%. Poland applies a worldwide taxation principle, meaning resident companies are taxed on global profits. Since 2019, a reduced 9% corporate income tax rate is available for small and medium-sized enterprises. Small businesses (with revenues under EUR 1.2 million) and companies newly starting operations in 2019 may qualify for this reduced rate.

Dividend Tax
Dividends received by a Polish resident company from another Polish, Swiss, or EU/EEA company are exempt from taxation under certain conditions. In other cases, dividends are taxed at 19%.

Capital Gains Tax
Poland does not have a separate capital gains tax rate. Capital gains are taxed at the standard corporate income tax rate of 19%.

VAT
The standard VAT rate in Poland is 23%. Reduced rates also apply: 8% for certain food products, some medical services, and housing, and 5% for specific food items such as dairy, meat, and bread.

Certain goods and services are exempt from VAT, including insurance and banking services, postal services, and services in education, science, and the arts.

Additionally, businesses with an annual turnover below 150,000 PLN are exempt from VAT registration.

Filing and Preparing Reports in Poland

Annual reporting provides detailed information on a company’s financial condition and creditworthiness, making it an important aspect of business operations.

All companies registered in Poland are required to submit annual reports. By default, the reporting period aligns with the calendar year (12 months), though companies may choose a different 12-month period.

Reports must be submitted to the National Court Register, which also handles company registrations.

Following recent legal changes, annual reports must be filed electronically, requiring an electronic signature. Additionally, at least one board member must have a PESEL number, which must be recorded in the register.

Conclusion

Company formation in Poland is a highly advantageous option that is not widely known. While entrepreneurs often think of other European countries for business formation, Poland may fully meet your needs. It offers a favorable business environment, low tax rates, and policies that support business growth and development.