Doing business-in-poland

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Doing Business in Poland
in few steps

www.consuldimo.com
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©2012 Consuldimo

Consuldimo
ul. Torfowa 12/4
Cracow, Poland

Author
Julita Mortka
Lawyer - M&A Specialist

Phone: +39 (0564) 405991
Mobile: +39 (334) 9818178
Email: j.mortka@consuldimo.com
Twitter: Consuldimo
Skype: julitamortka
www: www.consuldimo.com
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Why Poland is the right choice for investors? (1/2)

Poland is the only European country that does not give up recession
Currently, the euro zone is in crisis, a large economy remains stagnant and the changing political
situation in many of them does not improve the situation. This is an excellent opportunity to
change the viewing direction and pay attention to Central Europe. Poland is the only European
country that does not give up recession and on the contrary, gradually growing.

Geographical Position
Poland is an attractive country located in the heart of Europe. The geographical position is
a huge advantage of Poland. As a result, Poland has become a naturally gateway to eastern
markets. Poland’s economy combines both western and eastern. As a proof,there is still growing
exports and imports.

A large market
Poland due to its surface is attractive market, bigger than the other Central European countries
all together.
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Why Poland is the right choice for investors? (2/2)

Stable and growing economy EU Support
Despite the world news on the economic It should be noted that through the support
crisis, Polish economy remains stable. This is programms for new EU members in the years
due to several factors, including competitive 2007 – 2013 in Poland has been allocated 67
products, the reference value for money, billion of euro. By drawing the appropriate
favorable legislation and funding from the application, enterprenuers can get funds to
European Union. The International Monetary run a business.
Fund predicts that Polish GDP in 2012. 2.6%,
and in 2013 3.2%. It is expected that Poland
is now the fastest growing country in Europe.
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Main legal facilities

◆ Grants from UE 2007- 2013

◆ Special economic zones

◆ Duty-free zones

◆ Support for hiring unemployed

◆ Exemptions from local taxes
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Principle legal regulations for enterpreneurs

◆ The legal concept of doing business in Poland is best defined under Polish law in
the Act on Freedom of Economic Activity (2004);

◆ When you want to set up a company you should consider requirements under Polish
Commercial Code (2004);

◆ Others:

Banking Act Competition Law

Bankruptcy and Tax regulations
Reorganisation Law
Civil Code
Labour Law
Insurance Act
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Business regulations for EU citizens and others

◆ Regulations for EU citizens

According to Polish legislation, foreign citizens of EU, EEA, EFTA and
foreign persons from countries not party to the Agreement on the European Economic
Area, which may benefit from the freedom of establishment of the contracts by
these countries with the European Community and its Member States could carry out
economic activities on the same terms as Polish citizens.

Abovementioned means that they are free to choose the best suited form
of activity either:

- as an individual business,
- partnership,
- capital company.
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Business regulations for EU citizens and others

◆ Regulations for citizens out of EU

In the case of citizens of countries other than In other cases, citizens of other countries may
those mentioned above who: pursue economic activity only in:
1) posses in Poland:
a) the permit to settle, - limited partnership
b) the permit long-term resident of the EU - limited joint stock company
c) the permit for temporary residence - limited liability company
d) the permit the temporary residence - joint stock company
granted, staying on Polish territory or staying
on that territory for the purpose of family
reunification, family members
e) the status of refugees,
2) enjoy the Polish Republic temporary
protection,
3) posses a valid Card of the Pole,
4) are family members
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Few steps to start your business

Starting activity

Notification of Obtaining license
registration to public or permissions if
entities necessary

Registration as VAT Opening a bank “one window rule”
remitter account moduls for KRS, ZUS,
US, GUS

Choice of a Drafting articles of Signing notary’s deed Signing contract for
proper legal form association or statute registered office
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How much does it cost?

◆ Constant registration fees

- 500 PLN despite of the legal form of company

- 500 PLN for notification in MSiG

- 17 PLN for VAT registration

◆ Notary’s fees depend on amount of share capital
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association


Legal forms of business activity

BUSINESS
ACTIVITY

Sole proprietator
Taxes: 18%, 32% or Civil Law Partnership
19%

Partnerships Capital Companies
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Partnership

There is no share capital required, no legal personality, partners represent a company,
unlimited joint and several liability of the partners’ personal assets for the liabilities of the
company

◆ Registered partnership - model company for partnerships, unlimited responsability of
partners for company’s debts

◆ Professional partnership - reserved for professionals

◆ Limited partnership - based on at least two subjects: general partner with unlimited
responsability, limited partner who finance the company

◆ Limited join stock partnership - combination of partnership and joint stock company
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Capital company

Capital company is obliged to establish share capital according to legal limits, has a legal
personality. There is division between assets which belong to shareholders and to company.
Also management is separated from the owners rights. One of the main advantage is
limited liability of shareholders with unnlimited responsability of company in the same time.

◆ Limited liability company - min. share capital, 5.000 zl, one share at least 50 zl, subject

to corporate income tax 19%, exists after signing articles of association (in organization)

◆ Joint stock company - min. share capital 100.000 zl, one stock 1 gr, supervisory board
obliged, shares may be subject to public trading, subject to corporate income tax 19%

◆ European Company
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Accounting obligations

Documents for AGM

All companies that are obliged to prepare and the decision on profit distribution in the
annual audits where they must publish their: “Monitor Polski B”.
- balance sheet,
- profit and loss account, Audit
- statement of changes in the share capital
and the cash flow statement; Annual consolidated financial statements
- as well as an introduction to the financial of capital groups and annual financial
statements, statements of joint-stock companies, banks,
- the auditor’s opinion (if required), insurers and investment and pension funds
- the statement of discharge granted by the must be audited by licensed auditor.
Annual General Meeting of Shareholders
(which must take place max. before 6
months after finishing financial year)
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Taxation

◆ corporate income tax (CIT), ◆ tax on goods and services (VAT),

◆ personal income tax (PIT), ◆ excise duty,

◆ tax on civil law transactions, ◆ game tax

◆ real estate tax,

◆ tax on means of transport,

◆ inheritance and donations tax,

◆ agricultural tax,

◆ forestry tax,

◆ tax on dogs,
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CIT

Corporate Income Tax

◆ 19 % tax rate in 2012. Tax year could be different from the calendar year, but always
12 months;

◆ A branch of a non-resident company is generally taxed under the same rules as
Polish company. Only its Polish source income is subject to taxation;

◆ Corporate income tax is paid annually, advance monthly payments have to be made;

◆ Tax losses suffered by the company may be carried forward and set off against
over the five years;

◆ The standard withholding tax is 19% on dividends and 20% on interests and
royalties. If paid abroad the rate may be reduced under the double tax treaties.
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PIT

Personal Income Tax

◆ Domiciled individuals in Poland (over 183 days in Poland or if they they have
“life center” in Poland) are subject to tax on their world-wide income

◆ In most cases, natural persons in Poland are subject to the income tax calculated
in compliance with the progressive tax scale, differentiating following income
thresholds, 18% and 32%

◆ There is also a 19% lump sum rate tax applicable to natural persons conducting
business

◆ Capital revenues from sale of shares are subject to 19% tax
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VAT

Value Added Tax
Polish tax law provides for 4 VAT rates.

◆ The basic rate is 23% which is applied to majority of goods and services.

◆ Other rates:

8% - applies to a few groups of goods and services, e.g. goods related to health
protection, groceries,
5% - applies to supply of some farm produce and foodstuffs;

◆ The rate of special significance is a 0% rate. It is applicable, in particular, to exports and
intra-Community supply of goods, international transport services.
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VAT

Value Added Tax
Objective scope of taxation, determines chargeable events. Each person who professionally
carries out the below stated activities:

◆ supply of goods (meant as transfer of the right to dispose of tangible property as owner)

effected for consideration,

◆ supply of services for consideration; supply of goods is meant as any transaction which

does not constitute a supply of goods,

◆ export of goods,

◆ import of goods,

◆ intra-Community supply of goods,

◆ intra-Community acquisition of goods

…is subject to taxation.
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Contacts

Phone: +39 (0564) 405991
General: info@consuldimo.com
Facebook: Consudimo
Twitter: Consuldimo
Blog: www.forbusinessinpoland.com

Poland

12 Torfowa Street, Cracow, Poland
j.mortka@consuldimo.com
Skype: julitamortka

Cell: +48 (607) 97 99 80
Cell: +39 (334) 98 18178

Doing business-in-poland

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