Business in Poland Guidebook

Starting Business in Poland
Introduction
This document presents basic legal information about a business environment in Poland and it has
been prepared within the Polish American Innovation Bridge Project implemented by the Allerhand
Institute.
Set up a business!
A US business entity which would like to start conducting its business activity in Poland benefits from
the freedom of economic activity principle. That means, that any business activity may be conducted
unless it is directly restricted or forbidden by the law. A US entity may involve in a business as a sole
trader, a partner in a civil law partnership, partner in a partnership (general partnership, professional
partnership, limited partnership, limited joint-stock partnership) or as a shareholder in a capital
company (limited liability company and joint-stock company). American entrepreneur may also
launch branch or representative office in Poland.
Choose a form of a business activity

Before starting conducting a business activity, a prospect entrepreneur should decide which of
available forms is the most convenient regarding the size and type of the activity.
Biuro Projektu: ul. Wielicka 57, 30-552 Krakw; tel.: +48 12 341 46 48; www.innowacjaplus.com.pl
Please note that this document constitutes only introduction guide to possible forms of business
activity in Poland and the information presented herein are true, but also basic and simplified.
Decision on the form of running business in Poland should be always preceded by more detailed
analysis based on each individual situation including tax and legal status.
1. SOLE TRADER [JEDNOOSOBOWA DZIAALNO GOSPODARCZA]
Sole trader (sole proprietorship, self-employment) is the simplest and most popular way to conduct
business in Poland. If you intend to conduct business activity in Poland as a sole trader you need to
consider the below -mentioned rules and register your business before starting it.
Key rules of running business in Poland as a sole trader:

- you must be a natural person;
- you may conduct any business activity (as long as it is not restricted or reserved for other forms of
business);
- rules of conducting your business activity are regulated first of all by the Freedom of Economic
Activity Act;
- no formal deed of incorporation is required;
- you must run your business under your own name and surname (however additional trade name is
allowed and widely used in practice);
- you need to have an address in Poland;
- no minimal assets or contribution is required;
- you take full responsibility for success or failure of your business, including full liability for loss
(personal, unlimited liability);
- you may hire employees;
- you are considered as an entrepreneur in relations with other business entities and consumers and
therefore more strict regulations may apply to you.
Business registration as a sole trader:

In order to conduct business in Poland as a sole trader, you need to register in the Central
Registration and Information on Business (Polish: Centralna Ewidencja i Informacja o Dziaalnoci
Gospodarczej - CEIDG):
- via Internet on: ceidg.gov.pl (available in English);
- in any commune office in Poland.
You may start running your business just after registration. The registration is free of charge.
Upon registration in the CEIDG, you are automatically registered in the tax office, statistical office and
in the Social Security Institution, however it may be required to provide those institutions with some
additional documents or information. Tax identification number (NIP) and statistical number (REGON)
are issued automatically as well.
Taxes and bookkeeping:

When you conduct your business activity as a sole trader:
- you need to keep your books of account, but usually in a simplified way;
- you must monthly pay personal income tax (PIT) - there are several ways of taxation, but probably
the most simple and popular is a flat tax with 19% rate;
- you must monthly pay health and social security premiums - approx. PLN 490/month (=USD 125)
during first 2 years of running business and approx. PLN 1,150/month (=USD 290) afterwards;
- you must monthly submit your tax returns and social security declaration (it is possible online);
- if you hire employees, you must pay personal income tax and social security premiums for them
(which amounts depend on salaries amounts), as well as submit tax returns and social security
declaration for employees; declarations may be submitted online;
Closing your business:

As a sole trader you may:
- temporarily suspend trading for a period no longer than 24 month;
- entirely close trading.
Suspending and closing trading requires just notification in the CEIDG register, which is possible:
- via Internet on: ceidg.gov.pl;
1. CIVIL LAW PARTNERSHIP [SPKA CYWILNA]
A civil law partnership is also a very simple way to start business activity in Poland if you want to
conduct it with your business partner(s). This is a popular form among Polish small and medium
entrepreneurs (SME). Conducting business activity in the form of a civil law partnership also requires
registration.
Key rules of running a business in the form of a civil law partnership:

- your civil law partnership must consist of at least two partners (usually sole traders);
- you may conduct any business activity in the form of civil law partnership (as long as it is not
restricted or reserved for other forms of business);
- rules of conducting your business in the form of civil law partnership are regulated by the Freedom
of Economic Activity Act, the Civil code and the civil law partnership agreement;
- your civil law partnerships agreement should be concluded in writing;
- your civil law partnership is in fact just an agreement among partners entrepreneurs who want to
achieve common goal it is not a legal person or a flawed-legal person;
- you and your partners may choose a name of the partnership, but your surnames and additional
phrase spka cywilna (civil law partnership) or the abbreviation is sp. j.; should be used as
well;
- your civil law partnership must have an address in Poland;
- no minimal assets or contribution are required;
- there are no bodies in a civil law partnership - you and your partners should conduct affairs and
represent your enterprise;
- you and your business partners take full responsibility for its success or failure, including full liability
for loss (personal, unlimited, joint and several liability);
- your civil law partnership may hire employees;
- you and your partners are considered as entrepreneurs in relations with other business entities and
consumers and therefore more strict regulations may apply to you.
Business registration as a civil law partnership:

In order to conduct business in Poland in the form of a civil law partnership of sole traders you and
your partner(s) need to:
be registered in the CEIDG (as sole traders) as it is presented above;
sign a civil law partnership agreement;
register in the tax office, statistical office and in the Social Security Institution;
register your civil law partnership in the CEIDG.
You may start running your business just after registration. The registration is free of charge.

When you conduct your business in the form of a civil law partnership:
- your civil law partnership should keep books of account, but usually in a simplified way;
- your civil law partnership is not an income tax payer, partners pay monthly personal income tax
(PIT) individually - there are several ways of taxation, but probably the most simple and popular is
a flat tax with 19% rate;
- partners must yearly submit PIT tax returns;
- partners must pay health and social security premiums approx. in the amount of PLN 490/month
(=USD 125) during first 2 years of running business and approx. PLN 1,150/month (=USD 290)
afterwards and submit monthly social security declaration (it is possible online);
- if your civil law partnership hires employees, you must pay personal income tax and social security
premiums for them (which amounts depend on salaries amounts), as well as submit tax returns
and social security declaration for employees; declarations may be submitted online;.

Your civil law partnership may:
- temporarily suspend trading for a period no longer than 24 month (if it does not employ any
employees);
Suspending and closing trading require notification in the CEIDG, which is possible:
- via Internet on: ceidg.gov.pl;
The notification should be given by you and all other partners.
1. PARTNERSHIPS AND CAPITAL COMPANIES REGULATED IN THE COMMERCIAL

COMPANIES CODE
Besides conducting your business as a sole trader or in the form of a civil law partnership, you may
also start doing business in the form of a partnership or a capital company which are regulated in the
Commercial Companies Code. There are four partnerships (general partnership, professional
partnership, limited partnership and limited joint-stock partnership) and two capital companies
(limited liability company and joint-stock company). Your decision on the form should be determined
by the scale of your planned activity, number of your business partners and profile of your business.
Establishing all of the abovementioned entities require prior registration in the National Court
Register (KRS).
1.1. Partnerships
A partnership conducts an enterprise under its own business name. Partnerships do not possess a
legal personality however, they may acquire rights and assume obligations in their own name (they
are so-called flawed legal persons). In general, the partnership and its partners are liable for
partnerships obligations and their liability is unlimited. Rights and obligation in the partnership may
be transfer to another person only if the partnership agreement or articles of association allows it
and after obtaining the written consent of all partners.
a. GENERAL PARTNERSHIP [SPKA JAWNA]
A general partnership is a basic partnership. It is perfect for small business initiatives with small
number of partners who know each other.
Key rules of running a business in the form of a general partnership:

- your general partnership must consist of at least two partners (natural persons, flawed legal
persons or/and legal persons);
- your general partnership may conduct any business activity (as long as it is not restricted or
reserved for other forms of business);
- rules of conducting your business in the form of civil law partnership are regulated by the Freedom
of Economic Activity Act, the Commercial Companies Code and the general partnership agreement;
- your general partnership agreement must be concluded in writing or via Internet by using
published template;
- your general partnership will be a flawed-legal person;
- name of your partnership should be formed from the surnames of one or more partners and
additional phrase spka jawna (general company); the abbreviation is sp. j.;
- your general partnership should have a registered office and an address in Poland;
- there are no bodies in a general partnership - you and all other partners have right and obligation
to conduct your partnerships affairs and are obliged to represent it;
- you and your partners take full responsibility for the success or failure, including full liability for loss
(personal, joint and subsidiary liability of the partners);
- your general partnership may hire employees;
- you and your partners are considered as entrepreneurs in relations with other business entities and
consumers and therefore more strict regulations may apply to you.
Business registration of a general partnership:

In order to conduct business in Poland as a general partnership you need to register it in the KRS:
- via submission of the written motion to the local registry court;
- via the Internet on: https://ekrs.ms.gov.pl/.
You can start running your business in the form of general partnership just after registration. The
registration fee via Internet is PLN 350 (=USD 90) and in the KRS is PLN 600 (=USD 153).
Upon registration in the KRS your general partnership is automatically registered in the tax office,
statistical office and in the Social Security Institution however, it may be required to provide those
institutions with some additional documents or information. Tax identification number (NIP) and
statistical number (REGON) are issued and assigned to your general partnership automatically as well.

When you conduct your business in the form of a general partnership:
- your general partnership needs to keep a books of account, but usually in a simplified way;
- your general partnership should yearly prepare a financial-operational report and submit it to the
KRS and the tax office;
- your general partnership is not an income tax payer - only you and your partners pay (monthly)
income tax (PIT or CIT);
- you and your partners must yearly submit PIT or CIT tax returns;
- partners being natural persons submit social security declarations (it is possible online) and pay
health and social security premiums approx. in the amount of PLN 1150/month (=USD 290);
- if your general partnership hires employees, it must pay personal income tax and social security
and social security declaration for employees; declarations may be submitted online.

Your general partnership may:
- temporarily suspend trading for a period no longer than 24 months;
Suspending the business activity is possible if the partnership does not hire any employees. To
suspend trading you and your partners should adopt a resolution and notify the KRS.
Termination of your general partnership may be caused e.g. by the causes enlisted in the partnership
agreement, by partners resolution or by declaring partnerships bankruptcy. After the partnership
termination, partnership assets will be liquidated (the assets will be used to pay the partnerships
obligations and the remaining assets will be divided among you and your partners).
a. PROFESSIONAL PARTNERSHIP
A professional partnership may be established by partners with the purpose of practicing a liberal
profession (e.g. legal adviser, attorney, medical doctor, dentist, architect, accountant).
Key rules of running business in the form of a professional partnership:

- your professional partnership must consist of at least two partners (only natural persons) entitled
to practice the liberal profession;
- your professional partnership may conduct the activity of the liberal profession(s) of its partners;
- rules of conducting your business in the form of professional partnership are regulated by the
Freedom of Economic Activity Act, the Commercial Companies Code and the professional
partnership agreement;
- your professional partnerships agreement must be concluded in writing;
- it is a flawed-legal person;
- name of the partnership should be formed from the surnames of one or more partners and
additional phrase spka partnerska (professional partnership) or i partner(zy) (and
partner(s)); the abbreviation is sp. p.;
- your professional partnership should have a registered office and address in Poland;
- you and each of your partners has the right to conduct partnerships affaires and represent it,
although the management board may be appointed instead;
- you and other partners are personally liable only for obligations arisen from their own activity;
- your professional partnership may hire employees;
- your partnership is considered as an entrepreneur in relations with other business entities and
consumers and therefore more strict regulations may apply to it.
Business registration of a professional partnership:

In order to conduct business in Poland in the form of a professional partnership, you need to register
it in the KRS and which is possible only by submitting the written motion in the KRS. You can start
running your business just after registration. The registration fee is PLN 600 (=USD 153).
Upon registration in the KRS your professional partnership is automatically registered in the tax office,
statistical office and in the Social Security Institution however, it may be required to provide those
statistical number (REGON) are issued and assigned to your professional partnership automatically as
well.

When you conduct your business in the form of a professional partnership:
- your partnership needs to keep books of account, but usually in simplified way;
- professional partnership should yearly prepare a financial-operational report and submit it to the
KRS and the tax office;
- the professional partnership is not an income tax payer - only you and other partners pay (monthly)
personal income tax (PIT);
- partners must yearly submit PIT tax returns;
- partners submit social security declaration (it is possible online) and pay health and social security
premiums approx. PLN 1150/month (=USD 290);
- if your professional partnership hires employees, it must pay personal income tax and social
security premiums for them (which amounts depend on salaries amounts), as well as submit tax
returns and social security declaration for employees; declarations may be submitted online.

Your professional partnership may:
Termination of your partnership may be caused e.g. by the causes enlisted in the partnership
agreement, by partners resolution or when each partner lost the right to perform his profession.
After the partnership termination, partnership assets will be liquidated (the assets will be used to pay
the partnerships obligations and the remaining assets will be divided among you and your partners).
a. LIMITED PARTNERSHIP [SPKA KOMANDYTOWA]
A limited partnership characteristic feature is that there are two types of partners:
a) general partner, also described as the active partner, whose liability for the partnerships
obligations is unlimited and who may represents the partnership and conduct its affaires;
b) limited partner, also described as the passive partner, whose liability for partnerships obligations
is limited by the amount of commandite sum, who may neither represents the partnership nor
conduct its affaires, and whose main role is to provide the capital for the partnership.
Key rules of running business in the form of a limited partnership:

- your limited partnership must consist of at least two partners (natural persons, flawed legal persons
or/and legal persons);
- your limited partnership may conduct any business activity (as long as it is not restricted or
- rules of conducting your business in the form of limited partnership are regulated by the Freedom
of Economic Activity Act, the Commercial Companies Code and the limited partnership agreement;
- your limited partnerships agreement must be concluded in the form of notarial deed or via
Internet by using published template;
- your limited partnership is a flawed-legal person;
- name of your limited partnership should be formed from the surnames of the one or more general
partners (surnname(s) of the limited partner(s) may not be used) and additional phrase spka
komandytowa; the abbreviation is sp. k.
- your limited partnership should have a registered office and address in Poland;
- there are no bodies in a limited partnership - it is represented by the general partners, who also
conduct partnership affaires;
- general partners take full responsibility for the success or failure, including full liability for loss
(personal, joint and subsidiary liability of the partners); limited partners are liable only up to the
commandite sums amount;
- your limited partnership may hire employees
- your limited partnership is considered as an entrepreneur in relations with other business entities
and consumers and therefore more strict regulations may apply to it.
Business registration of a limited partnership:

In order to conduct business in Poland as a limited partnership you need to register it in the KRS:
- via submission of the written motion to the KRS (through local registry court);
- via the Internet on: https://ekrs.ms.gov.pl/.
You can start running your business in the form of a limited partnership just after its registration. The
fee for registration via Internet is PLN 350 (= USD 90) and via written motion it is PLN 600 (= USD
153).
Upon registration in the KRS the limited partnership is automatically registered in the tax office,
statistical office and in the Social Security Institution, however it may be required to provide those
statistical number (REGON) are issued automatically as well.

When you conduct your business in the form of a limited partnership:
- the basic way of accounting is conducting a full accounting (keeping accounting records);
- your limited partnership should yearly prepare financial-operational report and submit it to the KRS
and the tax office;
- Your limited partnership is not an income tax payer - only you and other partners pay (monthly)
income tax (PIT or CIT);
- partners must yearly submit PIT or CIT tax returns;
- partners being natural persons submit social security declarations (it is possible online) and pay
health and social security premiums approx. in the amount of PLN 1,150/month (=USD 290);
- if your limited partnership hires employees, it must pay personal income tax and social security

Your limited partnership may:
Termination of the partnership may be caused e.g. by the causes enlisted in the partnership
agreement, by partners resolution or when a partnership become insolvent. After the partnership
termination, partnership assets will be liquidated (the assets will be used to pay the partnerships
obligations and the rest divided among the partners).
a. LIMITED JOINTSTOCK PARTNERSHIP [SPKA KOMANDYTOWO-AKCYJNA]
A limited joint-stock partnership consists of at least one partner (general partner) with unlimited
liability towards the partnership's creditors and at least one partner who is a stockholder, not liable
for partnerships obligations.
Key rules of running business in the form of a limited joint-stock partnership:

- your limited joint-stock partnership must consist of at least two partners (natural persons, flawed
legal persons or/and legal persons);
- your limited joint-stock partnership conduct any business activity (as long as it is not restricted or
- rules of conducting your business in the form of joint-stock partnership are regulated by the
Freedom of Economic Activity Act, the Commercial Companies Code and the joint-stock partnership
agreement;
- your limited joint-stock partnerships articles of association must be concluded in the form of
notarial deed;
- a limited joint-stock partnership is a flawed-legal person;
- the name of your limited joint-stock partnership should be formed from the surnames of the one or
more general partners and additional phrase spka komandytowa- akcyjna (limited joint-stock
partnership); the abbreviation is S.K.A.
- your limited joint-stock partnership should have an address and registered office in Poland;
- limited joint-stock partnership bodies are: general meeting (mandatory) and supervisory board
(optionally);
- your limited joint-stock partnership is represented by general partners who also conduct
partnerships affaires;
- general partners take full responsibility for the success or failure, including full liability for loss
(personal, joint and subsidiary liability of the partners); stockholders are not liable;
- your limited joint-stock partnership should have the share capital with minimum value of PLN 50
000 (= USD 12 500); it can also have additional assets provided by general partners contributions;
- your limited joint-stock partnership may hire employees;
- your limited joint-stock partnership is considered as an entrepreneur in relations with other
business entities and consumers and therefore more strict regulations may apply to it.
Business registration as a limited joint-stock partnership:

you need to register it in the KRS and which is possible only by submitting the written motion in the
KRS. You can start running your business just after registration. The registration fee is PLN 600 (=USD
153).
Upon registration in the KRS your limited joint - stock partnership is automatically registered in the
tax office, statistical office and in the Social Security Institution, however it may be required to
provide those institutions with some additional documents or information. Tax identification number
(NIP) and statistical number (REGON) are issued and assigned to your limited joint - stock partnership
automatically as well.

When you conduct your business in the form of a limited joint-stock partnership:
- a full accounting (keeping accounting records) should be conducted;
- your limited joint-stock partnership should yearly prepare financial-operational reports and submit
them to the KRS and the tax office;
- your partnership is an income tax payer and pays (monthly) corporate income tax (CIT) in 15% or
19% rate;
- you and other partners must submit PIT or CIT tax returns and pay income tax (PIT or CIT) from
dividends;
- you and other partners are not obliged to pay health and social security premiums and to submit
social security declarations;
- if your limited joint-stock partnership hires employees, it must pay personal income tax and social
returns and social security declaration for employees; declarations may be submitted online;

Your limited joint-stock partnership may:
suspend trading general partners should adopt a resolution and notify the KRS.
Termination of the partnership may be caused e.g. by the causes enlisted in the articles of
association, by general meeting resolution or when the partnership will become insolvent. After the
partnership termination, partnership assets will be liquidated (the assets will be used to pay the
partnerships obligations and the rest divided among the partners).
1.1. Capital companies
In Poland, there are two types of companies among capital companies: a limited liability company
and a joint stock company. Both of them possess a legal personality and conduct business under
their own business name (legal persons). Shares and stocks, as a rule, may be transferred to another
person.
a. LIMITED LIABILITY COMPANY
A limited liability company (LLC) is popular form of conducting business activity among Polish
entrepreneurs. It can be formed by one or more persons.
Key rules of running business in the form of a limited liability company:

- your limited liability company should consist of one or more than one partners (natural persons,
flawed legal persons or/and legal persons);
- your limited liability company may conduct any business activity (as long as it is not restricted or
- rules of conducting your business in the form of limited liability company are regulated by the
Freedom of Economic Activity Act, the Commercial Companies Code and the companys articles of
association;
- your limited liability companys articles of association must be concluded in the form of notarial
deed or via Internet by using published template;
- your limited liability company has a legal personality;
- your limited liability companys minimum value of the share capital is PLN 5,000 (=USD 1,250);
- name of your limited liability should be formed from freely chosen name and additional phrase
spka z ograniczon odpowiedzialnoci (limited liability company); the abbreviation is sp. z
o.o.
- your limited liability company should have an address and registered office in Poland;
- your limited liability companys bodies are: the shareholders meeting and the management board;
it may also have the supervisory board, the audit commission or both;
- your limited liability company is represented by the management board (generally 2 members or 1
member and the commercial proxy);
- your limited liability company is liable for its own obligations; you and other shareholders are not
liable;
- your limited liability company may hire employees;
- your limited liability company is considered as an entrepreneur in relations with other business
entities and consumers and therefore more strict regulations may apply to it.
Business registration as LLC:

In order to conduct business in Poland in the form of a limited liability company you need to register
it in the KRS:
- via the Internet on: https://ekrs.ms.gov.pl/;
- via submission of written motion in the local registry court.
The registration via Internet costs 350 PLN (=USD 90) and in KRS costs PLN 600 (=USD 153).
Upon registration in KRS you are automatically registered in the tax office, statistical office and in the
Social Security Institution, however it may be required to provide them with some additional
documents or information. Tax identification number (NIP) and statistical number (REGON) are issued
You can start running your business in the form of a limited liability company even before registration,
but after concluding companys articles of association. Until registration in the KRS your company will
be considered as a limited liability company in organization (in the process of formation) and will not
have a legal personality.

When you conduct your business in the form of a limited liability company:
- your limited liability company should conduct full accounting (keeping accounting records);
- your limited liability company should yearly prepare financial-operational reports and submit them
to the registry court and the tax office;
- your limited liability company pays the corporate income tax (CIT);
- you and other partners pay income taxes (PIT or CIT) from dividends;
- you and other partners do not pay social security premiums unless there is only one partner being a
natural person;
- if your limited liability company hires employees, it must pay personal income tax and social
returns and social security declaration for employees; declarations may be submitted online.

Your limited liability company may:
Suspending the business activity is possible if your limited liability company does not hire any
employees. To suspend trading the shareholder meeting should adopt a resolution and notify the
KRS.
Termination of your limited liability company may be caused e.g. by the causes indicated in the
articles of association, by the shareholders meetings resolution or when the companys registered
office is transferred to another country. After termination of your limited liability company its assets
will be liquidated (the assets will be used to pay the companys obligations and the rest divided
among the partners).
a. JOINT STOCK COMPANY [SPKA AKCYJNA]
A joint stock company is the most complex commercial company in Poland and the procedure of
starting business activity is the most complicated. In some business areas, it is required to conduct
affairs in the form of a joint-stock company (e.g. banks). Joint-stock companys stocks may be subject
of trade in a stock exchange (after fulfilling additional requirements).
Key rules of running a business in the form of a joint-stock company:

- your joint-stock company should consist of one or more stockholders (natural persons, flawed legal
persons or/and legal persons);
- your joint-stock company may conduct any business activity (as long as it is not restricted or
- rules of conducting your business in the form of joint-stock are regulated by the Freedom of
Economic Activity Act, the Commercial Companies Code and the joint-stocks articles of association;
- your joint-stock companys articles of association must be concluded in the form of notarial deed;
- your joint-stock company has legal personality;
- the name of your joint stock company should be formed from freely chosen name and additional
phrase spka akcyjna (joint-stock company); the abbreviation is S.A.
- your joint-stock company should have an address and registered office in Poland;
- your joint stock-companys minimum share capital value is PLN 100 000 (=USD 25 000);
- its bodies are: the general meeting, the management board and the supervisory board;
- your joint-stock company is represented by the management board (generally 2 members or 1
member and the commercial proxy);
- your joint stock-company is liable for its own obligations; you and other stockholder are not liable;
- your joint stock-company may hire employees;
- your joint stock company is considered as an entrepreneur in relations with other business
entities and consumers and therefore more strict regulations may apply to it;
- joint-stock companies listed in the stock market are also obliged to fulfill additional duties related
to trading in the stock market.
Business registration of a joint-stock company:

In order to conduct business in Poland in the form of a joint - stock company, you need to register it in
the KRS via submission of the written motion in the KRS.
The registration fee via Internet is PLN 350 (=USD 90) and in the KRS is PLN 600 (=USD 153).
Upon registration in the KRS you are automatically registered in the tax office, statistical office and in
the Social Security Institution, however it may be required to provide them with some additional
documents or information. Tax identification number (NIP) and statistical number (REGON) are issued
You can start running your business in the form of a joint stock company even before registration, but
after concluding companys articles of association. Until registration in the KRS your company will be
considered as a joint stock company in organization (in the process of formation) and will not have a
legal personality.

When you conduct your business in the form of a joint-stock company:
- your joint-stock company should conduct a full accounting (keeping accounting records);
- your joint-stock company should yearly prepare financial-operational reports and submit them to
the registry court and the tax office;
- your joint-stock company pays the corporate income tax (CIT);
- you and other stockholders pay personal income tax (PIT) or corporate income tax (CIT) from
dividends;
- if your joint-stock company hires employees, it must pay personal income tax and social security
- if your companys yearly revenue exceeds PLN 200,000 (=USD 50,000), the partnership should
register in the tax office as VAT tax payer, pay VAT on monthly basis and submit monthly VAT tax
returns; declaration may be submitted online.

Your joint-stock company may:
Suspending the business activity is possible if your joint-stock company does not hire any employees.
To suspend trading the general meeting should adopt a resolution and notify the KRS.
Termination of your joint-stock company may be caused e.g. by the causes indicated in the articles of
association, by the general meetings resolution or when the companys registered office is
transferred to another country. After termination of your joint-stock company its assets will be
liquidated (the assets will be used to pay the companys obligations and the rest divided among the
partners).
1. BRANCH [ODDZIA]
If you have an enterprise in the USA and you do not want to open a partnership or a capital company
in Poland, you may consider starting a business as a branch. Launching and conducting business in
the form of a branch of a foreign entrepreneur is regulated by the Freedom of Economic Activity Act.
A branch is a separate and organizationally independent part of business activities carried out by the
entrepreneur beyond his registered office or the place of his main business activity.
Key rules of running a business in form of branch:

- branch of your enterprise in Poland will be able to conduct business only in the scope that is
already conducted in the USA;
- it does not matter if your enterprise is a big or small company this form is available for every size
of business;
- it does not have legal personality neither can be sued;
- your enterprise should use the original business name (that you use in the USA) with the Polish
translation of the legal form (e.g. if you conduct business as an LLC, then you should add spka z
ograniczon odpowiedzialnoci) and with phrase oddzia w Polsce
- your enterprise should have an address in Poland;
- there are no minimal contribution or assets required;
- branch of your enterprise does not have any bodies however, there must be a person appointed
and authorized to represent it in Poland;
- your enterprise in the USA will be fully liable;
- you can hire employees though your branch.
Business registration:
To open a branch of foreign entrepreneur you should register it in the KRS via submission to the
motion to the local registry court. The motions cost is PLN 600 (USD = 153). You cannot register the
branch via Internet.
Upon registration in the KRS your branch is automatically registered in the tax office, statistical office
and in the Social Security Institution however, it may be required to provide them with some
additional documents or information. Tax identification number (NIP) and statistical number (REGON)
are issued automatically as well.

When you conduct your business activity through the branch of your enterprise:
- your branch should yearly prepare financial-operational reports and submit them to the KRS and
tax office;
- money transfers between the branch and your enterprise in the United States are not taxed in
Poland - only income generated in Poland is taxed;
- your branch is required to conduct bookkeeping regarding Polish business activity in Poland and in
respect to Polish provisions;
- if your branch hires employees, it must pay personal income tax and social security premiums for
them (which amounts depend on salaries amounts), as well as submit tax returns and social
security declaration for employees; declarations may be submitted online;.

A branch of your enterprise may:
Suspending the business activity is possible if the branch of your enterprise does not hire any
employees. To suspend trading the proper body of your enterprise (e.g. partners, shareholders
meeting) should make such decision and the KRS should be notified.
Termination of the branch may be caused e.g. by the decision of the foreign entrepreneur or by the
decision of Polish authorities to forbid the branch further activity.
1. REPRESENTATIVE OFFICE [PRZEDSTAWICIELSTWO]
If you have an enterprise in the USA and you do not want to start doing business in Poland, but firstly
you would like to just promote your business in Poland, you should consider launching a
representative office. A representative office is the form of business activity that allows the foreign
entrepreneur to conduct advertising and promotion in Poland.
Key rules of conducting activity in the form of a representative office:

- you will be able to conduct only advertising and promotion (you cannot trade through the
representative office);
- representative office does not have legal personality neither can be sued;
- there are no minimal contribution or assets required;
- you should use your business original name with the Polish translation of the legal form and phrase
przedstawicielstwo w Polsce (representative office in Poland);
- representative office has no bodies
- the representative office of your enterprise does not have any bodies, however there must be a
person appointed and authorized to represent it in Poland;
- your enterprise in the US will be fully liable;
- you may hires employees through your representative office.

When you conduct activity through a representative office:
- money transfers between the representative office and your enterprise in the United States are not
taxed in Poland; only income generated in Poland is taxed;
- you will be required to conduct bookkeeping regarding Polish business activity in Poland and in
respect to Polish provisions;
- if your representative office hires employees, it must pay personal income tax and social security
and social security declaration for employees; declarations may be submitted online;.

The representative office cannot suspend its activity. If the foreign entrepreneur wants to close it only
for a specific period of time, it can reopen it later.
Termination of the representative office may be caused e.g. by the decision of the foreign
entrepreneur or by the decision of Polish authorities to forbid the further activity. After the
termination, representative office assets will be liquidated. Assets will be liquidated according to
provisions regulating LLC liquidation.
Tax System in Poland

Poland US Treaty
Poland and the United States concluded the treaty to avoid double taxation, that sets a general rule,
that a resident of one country may be taxed by the other country on any income from sources within
that other country and only on such income. Furthermore, it states that profits of an enterprise are
taxable only by the country of its seat unless in the other country there is a permanent establishment
(branch). The income of such permanent establishment is taxed in the country of its registered office.
That means, that American company is in general taxed in the United States, but when it opens a
permanent establishment in Poland, the income produced by this establishment shall be taxed in
Poland.
Income taxes
When you conduct business activity in Poland you may be obliged to pay Polish income taxes. There is
a personal income tax (PIT) and a corporate income tax (CIT).
PIT:
applies to natural persons (sole traders, partners and civil law partnerships as well as
partnerships and companies regulated in the Commercial Companies Code);
its basic rates are progressive: 18% for the income that does not exceed approx. PLN 85,500
(=USD 21,600) and 32% tax rate is applicable for the surplus (however, due to tax deductions,
your tax will be lower);
income tax rate for dividends is 19%;
sometimes, taxpayers may choose flat taxation (19% rate) instead of progressive taxation,
lump sum tax on registered income or tax deduction card.
CIT:
applies to legal persons and some flawed legal persons (limited joint-stock partnership);
tax rate is in general 19% of the income (15% for small taxpayers and taxpayers who just
started their business activity);
is paid by the company to the tax office.
Value Added Tax (VAT)
If your enterprises yearly revenue exceeds PLN 200,000 (=USD 50,000), it should register in the tax
office as a VAT tax payer, pay VAT on monthly basis and submit monthly VAT tax returns; declaration
may be submitted online.
VAT:
the subject of taxation is a non-gratuitous delivery of goods and services;
VAT rates are: 23% (basic rate), 8%, 5% and 0%;
A VAT payer should monthly submit tax declaration until the 25th day of the month following
the month in which the VAT obligation arose;
VAT is generally neutral (fully deductible) in business transactions and the VAT payer is in fact
always a final consumer
You should register your enterprise in the tax office as VAT tax payer if its yearly revenue exceeds PLN
200,000 (=USD 50,000). Your enterprise should pay VAT on monthly basis and submit monthly VAT tax
returns; declaration may be submitted online. If your enterprise is a VAT payer, it may be necessary to
manage fiscal cash register.
Other taxes
Besides that, an entrepreneur in Poland might be obliged to pay other taxes such as:
- excise tax,
- real estate tax,
- tax on civil law acts
- tax on inheritance and donations.
which is contingent upon the subject of business activity and transactions carried out.

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Business in Poland Guidebook

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Starting Business in Poland

Choose a form of a business activity

1. SOLE TRADER [JEDNOOSOBOWA DZIAALNO GOSPODARCZA]

Key rules of running business in Poland as a sole trader:

Business registration as a sole trader:

Taxes and bookkeeping:

Closing your business:

1. CIVIL LAW PARTNERSHIP [SPKA CYWILNA]

Key rules of running a business in the form of a civil law partnership:

Business registration as a civil law partnership:

register your civil law partnership in the CEIDG.

Taxes and bookkeeping:

Closing your business:

1. PARTNERSHIPS AND CAPITAL COMPANIES REGULATED IN THE COMMERCIAL

a. GENERAL PARTNERSHIP [SPKA JAWNA]

Key rules of running a business in the form of a general partnership:

Business registration of a general partnership:

Taxes and bookkeeping:

Closing your business:

Key rules of running business in the form of a professional partnership:

Business registration of a professional partnership:

Taxes and bookkeeping:

Closing your business:

a. LIMITED PARTNERSHIP [SPKA KOMANDYTOWA]

Key rules of running business in the form of a limited partnership:

Business registration of a limited partnership:

Taxes and bookkeeping:

Closing your business:

a. LIMITED JOINTSTOCK PARTNERSHIP [SPKA KOMANDYTOWO-AKCYJNA]

Key rules of running business in the form of a limited joint-stock partnership:

Business registration as a limited joint-stock partnership:

Taxes and bookkeeping:

Closing your business:

1.1. Capital companies

Key rules of running business in the form of a limited liability company:

Business registration as LLC:

Taxes and bookkeeping:

Closing your business:

a. JOINT STOCK COMPANY [SPKA AKCYJNA]

Key rules of running a business in the form of a joint-stock company:

Business registration of a joint-stock company:

Taxes and bookkeeping:

Closing your business:

Key rules of running a business in form of branch:

Taxes and bookkeeping:

Closing your business:

1. REPRESENTATIVE OFFICE [PRZEDSTAWICIELSTWO]

Key rules of conducting activity in the form of a representative office:

Taxes and bookkeeping:

Closing your business:

Tax System in Poland

income tax rate for dividends is 19%;

is paid by the company to the tax office.

Value Added Tax (VAT)

the subject of taxation is a non-gratuitous delivery of goods and services;

VAT rates are: 23% (basic rate), 8%, 5% and 0%;

- real estate tax,

- tax on civil law acts

- tax on inheritance and donations.

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