How to open a business in Poland: laws, taxes, economy, facts

If you came to this article, it means that you are already thinking about starting a business in Poland or business immigration. This great guide will answer all questions related to Polish legislation, taxation, economics and will help avoid many mistakes when starting a company.

Our team has helped you open more than 100 companies for emigrants from Ukraine, Belarus and other countries. And we want to share our professional view of the business in Poland and the nuances associated with its launch.

For convenience, use the navigation of the article:

Introductions

In Poland, small and medium-sized businesses are very well developed – enterprises of this level create almost 70% of the country’s GDP. Such a situation has been achieved due to the simplification of documentation systems, minimization of corruption schemes and stable national currency. That is why Polish economy has become one of the fastest growing in the EU and this, in turn, gives business even more confidence to invest and develop.

According to the state structure: the Office for Foreigners of Poland, from almost 20 thousand citizens of other countries that conduct their own business in the country, about 5 thousand people (25%) are citizens of Ukraine. Ukrainians and Belarusians in 2019 jointly purchased almost 200 thousand square meters of housing in Poland (this is almost 4 times more than the Germans, who are also in the lead).

We can help you solve any task!

Stanislav Tsys

Head of UniConsulting

Get consultation

Are you planning to start a business in Poland? Start a company or a private enterprise? We will help you bring your business to the Polish market from scratch until the first sales. We will develop: a strategy for entering the Polish market, open a remote legal entity or IE, will do accounting and registration of your employees. Leave an application for introductory consultation

According to the nationwide Central Register of Insurers of Poland, the number of foreigners who have taken out pension and disability insurance has increased more than 10 times in the past 10 years (from 65,000 in 2008, to 683,000 in 2019).

Such figures quite simply characterize the state’s position towards foreigners: come, work officially, build a business in Poland, create jobs, and the country will support your endeavors. And, judging by statistics, this approach works, and works well.

So, what, why, how and when? Step-by-step instructions for those who want to start their own business in Poland.

Advantages of Poland as a country for business and life

Today the Republic of Poland is one of the few European states with stable economic growth and improving social standards. But the country is attractive to Slavic migrants for some other reasons: similar culture, mentality, Polish language (close to Ukrainian/Belarusian/Russian), etc.

A bit of history

After the collapse of the USSR, the state of the Polish economy was dismal. All the eastern markets were lost. In such circumstances, large and small businesses in Poland were forced to reorient to the West. The Association Agreement with the EU was signed in 1991, and four years later the adaptation of national legislation to the European one started. This process took 9 years, and already in 2004 the state joined the EU as a full member. Accession to the European Union has radically changed the economic situation, laws, infrastructure, tax system of Poland, which led to the rapid development of business in Warsaw and other cities of the country.

Poland’s place on the world stage. Top famous Polish companies

Poland is now a promising country for investment. World observers describe Polish economy as safe for doing business and long-term planning. Modern financial and economic indicators show a favorable environment for doing business in Poland. This is possible due to regular modernization of infrastructure and mass implementation of modern technologies in production.

The World Bank Group in its Doing Business 2019 report ranked Poland 33rd in the world out of 190 countries in terms of the ease of doing business. The state ranks among the best manufacturers in Europe and Central Asia, and is also a leader among EU members in Central Europe.

On September 24, 2018, the country joined (according to the FTSE Russel Index) the group of 25 countries with developed markets economies (including the United Kingdom, Canada, the United States).

International companies such as IBM, CreditSwiss, Capgemini, CitiGroup, Royal Dutch Shell, etc. have moved or are moving some of their activities to the Republic of Poland. But Polish companies themselves also play an important role on the international market.

Among the top brands of companies in Poland are:

• The LPP chain of stores, whose brands include Reserved, Cropp, Talinder, Sinsay and a number of other clothing stores;
• Inglot Cosmetics. Its brand outlets are located in more than 40 countries around the world in the most prestigious retail outlets. In New York, for example, there is an Inglot boutique on Broadway and 48th Street, and in Las Vegas, in the famous Caesars Palace;
• Solaris is a major manufacturer of motor vehicles. The concern manufactures streetcars, emergency vehicles and vans, buses, trolleybuses;
• CCC shoe stores, which are widely known throughout Europe;
• GinoRosi is another shoe brand. The company was founded in 1992 by Polish and Italian designers and was named after the surname of one of the founders – Italian Gino Rosi. Stores of men’s and women’s shoes of this brand can be found in many European cities;
• CD Projekt is a company that publishes, localizes and develops computer games. This is the main profile, but in addition, its subsidiaries are engaged in service of digital distribution of games without DRM;
• KROSS is a well-known European manufacturer of bicycles. The company sells its products in 43 countries around the world. The quality of KROSS bicycles has turned this small company into a world-famous brand in just a few years.

Growth dynamics

Growth dynamics of economically important indicators. The most active business areas.

Despite the global economic crisis and the economic downturn in Europe, Poles manage to maintain high rates of GDP growth. Between 1992 and 2019, this figure averaged 4.2% per year. This made the country’s economy the seventh largest among other members of the European Union. There are several reasons why businesses in Poland have been so successful:

1. High export competitiveness.
2. Affordable real estate market.
3. Active domestic consumption.
4. Support of labor market by immigrants from CIS countries.
5. Relatively low taxes in Poland and affordable credit.

Poland was the only European country to avoid recession during the 2008-2009 financial crisis. For almost 30 years it managed to increase GDP per capita almost 8 times. As we have already mentioned, it is small and medium-sized entrepreneurs, who account for almost 70% of GDP, who deserve a lot of credit for this.

The variety of profitable businesses in Poland is confirmed by the spheres of activity of the richest representatives of the country:

• Sebastian and Dominika Kulczyk. Their interests include industry, raw materials, infrastructure;
• Television magnate Zygmunt Solozh-Jacques. His Polsat corporation includes more than 20 television channels;
• Michal Solovovov. Engaged in the chemical industry and building materials;
• Dariusz Milek. Started as a shoe department in Lublin, his chain of CCC stores sells 20 million pairs of shoes annually;
• Anna Wozniak-Starak and Jerzy Starak’s interests include the pharmaceutical and food industries;
• Leszek Czarnecki is involved in finance and real estate;
• The Furman brothers. Jacek, Wojciech and Tomasz are involved in the pharmacology business;
• Jaroslav Pavliuk. He made his fortune in logistics and transport;
• The Alszewski brothers. Founders of SolarisBus&Coach.

The political environment

Poland is a democratic parliamentary republic with a bicameral parliament, with citizens electing the President as well as the Parliament (Sejm and Senate) in general elections.

One of the main components of Poland’s successful economic development are European integration and reformism. The Western course became the main idea of Poles and united the society back in the 90s. Since the collapse of the Union the direction of the country has remained unchanged, despite the change of ruling parties and presidents. The country is challenging Germany and France for the first place in the Eurozone and is strengthening its relations with Europe and the United States.

How is the country convenient for Ukrainians, Russians and Belarusians?

Every year hundreds of thousands of Ukrainians, Belarusians and natives of other post-Soviet republics come to Poland to work or do business. They all come for a new future and new business opportunities.

Such popularity is easily explained by the following factors:

• Proximity to borders.
  Poland shares borders with Russia (Kaliningrad), Belarus, Ukraine, Lithuania, the Czech Republic, Slovakia, and Germany. Active air/rail/auto traffic, you can get back to your home country in just a few hours as needed.
• Similar mentality.
  The country is quite comfortable for the inhabitants of post-Soviet republics – it concerns both everyday life and conditions for registering and running a company and entrepreneurship in Poland. Poles are sort of “Slavs 2.0”).
• Language.
  In Poland it is quite easy to find a person who speaks Russian. Ukrainian and Belarusian diasporas are among the largest in the country. Polish is more or less understandable immediately upon arrival, and after a few months – speak it at a sufficient level of everyday life. Plus in many cities ATMs, self-service cash desks in supermarkets, etc. have a choice of Russian/Ukrainian language (unlike the same Germany or Spain, where you can’t find ATMs in Russian and language, even fluently, you can’t learn for a few months).
• Moderate taxation. In Poland is not the lowest taxes in Europe, but also not the highest. For example in Sweden, Germany, Italy, Belgium, taxes are higher. The leader among EU countries is France, where the tax on withdrawn capital is twice as high as in Poland.
• Quite low interest rates.
  Loans, deposits, leasing, factoring are all available, with low rates and convenient conditions for taxpayers to the country’s treasury. For example, the average rate on mortgage loans in Poland is 3.79%.
• A well-developed system of business support from the government.
  Subsidies, preferential loans and co-financing, available to companies from different levels of institutions – as part of the European Funds, as well as Polish (at the city and region). In addition, launching a business in Poland will give access to export insurance to the EU countries and partially to the CIS. In simple terms: if you sell Polish goods or services for export, the state is ready to insure these transactions and in case of risks / force majeure to pay unpaid bills from the treasury budget.
• The procedure for obtaining a residence permit and a visitor’s card on the basis of business is quite simple.
  A temporary residence permit allows you to live and work in the country for 1-3 years. With the right to extend and then obtain a “residence card” or EU residence card for an unlimited period of stay.

The grounds for obtaining a residence permit are (top 5 basic):

1. own firm in the Republic of Poland;
2. work;
3. enrollment and study at a Polish university;
4. registered marriage with a Polish citizen;
5. Polish card.

Business in Poland – nuances and peculiarities of doing business

Doing business in Poland offers many advantages. The owner of a company can count on state support and European standard of living, as well as a stable banking system with affordable and favorable lending. When registering himself as an employee of his own company in Poland, the founder and his family are entitled to enjoy various social benefits. Among them – access to free medical services, public schools, pre-schools, etc. It is appropriate to study, 8 reasons to open a firm in Poland:

Active business gives you the opportunity to apply for a residence permit, and over time, the registration of the Permanent Residence Permit and citizenship. The residence permit (karta czasowego pobytu / temporary residence card) allows you to live and work in the country permanently. At the same time, it is possible to travel outside the country and visit other Schengen and EU countries without a visa.

Local legislation grants companies in Poland founded and managed by foreigners the same rights as other business entities. Therefore, to register a company and open a bank account only a valid passport and the ability to sign documents, if it is an online company registration is required. Please apply for help in opening a company in Poland and we will advise you. As with any country, there are disadvantages. Watch video interviews with testimonials from six entrepreneurs who actually do business in Poland.

Peculiarities of work with Poles

Poles have their own peculiarities and it’s good to know that

We have already written above, Poles are similar to the rest of the Slavs. But the Polish mentality has its own peculiarities, which must be taken into account when doing business in Poland:

• Poles are much more smiling, open and polite. Service workers are friendly. A phlegmatic attitude can be found in public institutions or at the post office.
• Poles are used to trusting verbal recommendations of acquaintances and friends. Rather conservative to everything new. The quantity and quality of reviews greatly influences their decision to buy services or goods.
• When negotiating with business partners in Poland, you have to use specific figures, research data and accurate forecasts. This is the only way to convince them of the benefits of your offer. Promises and words alone make it very difficult to interest a Polish businessman 🙂
• Take personal and personal data seriously: phone numbers, mailing addresses, etc. If it is necessary to exchange such contacts – it is necessary to foresee and protect your personal data and customer data;
• Poles support local producers. If you are planning to open a company in Poland in the field of production of goods, be sure to consider this point. Try to use every opportunity in the process of producing your products to get the inscription “Wyprodukowane w Polsce” on the package.
• Poles are disciplined and know their rights. In addition, they like to complain and do it for any reason: bad weather, poor quality food, low level of service. This manifests itself in personal conversations and in more serious moments – filing an application to the court. Therefore, the courts here do not sit idly by.
• Poles respect honesty and integrity, they value experience and reliability. If you ask one of them to talk about their way to success, they will be modest and underestimate their own achievements. People here believe that you should not speak at every corner about their merits and victories. Your deeds should speak for you.
• Correspondence and written agreements. During business negotiations verbal agreements are not accepted here, agreements are signed on all points.

What kind of business to open in Poland? 5 promising niches

Long-term work in the Polish market allows us to predict the most interesting and relevant areas for starting a business in Poland in 2023. In these niches you can return the investment in the shortest possible time, expand and reach a new business level. Related video:

Car repair shops, service stations, car washes, etc. related to the maintenance of motor vehicles

Everything related to the repair and maintenance of vehicles is very relevant in the Polish market.

According to statistics, Polish companies cover about 30% of freight transport in Europe. The popularity of this area is due to the rapid development, high profitability and tangible demand for services of this kind. This leads to a constantly growing number of cars. At the same time, specialized truck service stations are an infrequent occurrence in small towns of the country.

Quality truck car service provides the following approximate list of services:

• disassembly and replacement of parts in trucks;
• battery charging, lubrication of units and assemblies;
• straightening, welding and other types of body work;
• repair and maintenance of the steering system;
• repair of engine, fuel system and other parts of the car;
• scratch removal, painting and polishing.

Also as an additional direction, you can engage in retail sales of spare parts and consumables for trucks, opening, for example, a small store at the service station.

The Taxi Fleet Services, Passenger Transportation

Among the popular options for small businesses in Poland (again, related to motor vehicles) is a small cab service with its own fleet of vehicles and hired drivers. In fact, it is a company with drivers and cars, but the role of the company’s car dispatcher is performed by Uber and similar apps. And though Uber has certain requirements for a company to become a partner, – such construction of business processes gives an opportunity to start in a short period of time with the established scheme of work.

It is worth noting that a valid license is obligatory for vehicles decorated in cab colors. In its absence, there are penalties in the amount of 8,000 PLN.

Beauty salon (hairdressing salon, barbershops, nail salon)

Many Poles point out the insufficient level of local specialists in the field of beauty and the related high need for qualified personnel. To open a company in Poland aimed at the beauty industry, it is necessary to combine the traits of a cold businessman, a lover of beauty and have sufficient skills in this field.

Beauty business is a promising direction, its advantage is stability and sustainability in times of crisis. The main task is to build up a customer base as quickly as possible. Women (and many men) are willing to spend a budget on their appearance, while many of them are constant in their desires. By the way, if you are from this area, we advise you to use the service to receive and manage applications: they are leaders and will be able to give you customers.

Of course, to do so is allowed only in the premises that meet the sanitary requirements set out in a special document of the Ministry of Health of Poland from 17.02.04 They apply to all hair salons, beauty salons, cosmetology, tattooing, etc.

And lastly, we recommend reading the video interview of our client:

Private kindergarten

Another potentially sought-after small business in Poland for Ukrainians is kindergartens in new areas of settlements. Many parents will prefer a kindergarten within walking distance of their home, and the presence of professional Polish educators will cause their special trust.

Over time, quality work and a serious approach to business will help create a high reputation for the preschool and make it a recognizable brand. Among the particularly attractive services can be healthy individual meals, delivery of children with their own transport, in-depth study of foreign languages and others.

Construction

Registration of a company in Poland for further full-fledged entry into the local construction market also looks quite promising. At the same time, if you are not planning to limit yourself to a small brigade contract, you will have to overcome the competition of already existing construction companies. However, the active development of the construction business, stable economic growth and a growing population (more than 38 million inhabitants) play in your favor. And while it is quite difficult to qualify for a large multi-million dollar market player, individual contractors or repair teams will always be in demand in the local market. Recently we successfully registered a sp zoo. The client is just planning to do construction:

Buy a ready-made business in Poland

Franchising

Franchise is the purchase of a ready promoted name (brand, trademark) with a proven working business model for the further conduct of a similar company. Its main advantages are the proven mechanism of all business processes, recognizability and high reputation of the brand, which becomes one of the most important aspects of the success of the new company.

As a typical example, we can take the opening of the cafe. Conventional institution “No Name” before reaching a decent level of profit needs to gain the trust of customers. Spoiled great choice of cafes visitors at first will be keen to assess both the cuisine and service, and the interior of the institution. Paying special attention to various unfamiliar to them nuances.

If a local resident notices a familiar sign “ХХХХХ” in his area, it is very likely to get a loyal customer who is already familiar with the range of such cafe and completely trust them. Coming into a familiar institution, the customer is unlikely to be interested in its owners. In this brand recognition will significantly reduce the payback period of the institution. But the franchise has its pitfalls. Of the disadvantages that can be encountered when choosing such a business, it is worth noting the following:

1. The rather high price of the franchise increases the amount of initial expenses. In most cases, there are monthly payments (royalties) to the brand owner.
2. A franchise assumes strict adherence to the business model, which includes a list and recipe of dishes (if it is a restaurant), as well as the appearance of the establishment and the behavior of the staff. And if it is planned to refine and integrate new mechanisms and ideas into the business, you will have to agree with the owner of the brand. Which can lead to a conflict of interest and complications in the work of the company.

Nevertheless, the use of franchising is of great interest to the migrant businessman as a quick way to start a business here.

Buying a ready-made business “from hand

Acquisition of an officially registered company with assets (if any) can speed up the process of business immigration to Poland.

It can belong to one of the following categories:

• existing only on paper without conducting any activities;
• working with a “zero profit” or minimal profit;
• working in a particular niche with a stable profit.

Regardless of the category, buying a ready-made firm has the following advantages:

• fully completed registration formalities;
• a simple and fairly quick procedure for changing ownership;
• It is naturally possible to change the name and legal address;
• further obtaining a residence permit in Poland through the opening of the company, the possibility of transactions with EU residents, etc.

You can buy a ready-made business in Warsaw and other cities in Poland in two ways:

• With the help of special agencies. With our database of companies for sale, we will help you find a suitable company, arrange a meeting with its owner, conduct a financial analysis and help you draw up all the necessary documents. Yes, our services are not free – but this way is the most convenient and safest.
• Buy a business on your own. Find a ready-made company for sale on your own by searching on various sites and forums. We recommend starting with the portal of our partner Strefabiznesu.pl. You can check it yourself through the free service of the National Court Register of Poland, or you can ask for help from partner lawyers.

Since when buying a ready-made business there is a high risk of buying a company with debts, special attention should be paid to its audit. For example, the legal address of the company must necessarily coincide with the actual address. Such a large-scale audit is better to entrust to experienced professionals – accountant and lawyer who know all the intricacies of local legislation and will understand the real legal and financial situation of the company. Ready to consult you on your direction.

Business representation (przedstawicielstwo)

Przedstawicielstwo firmy zagranicznej is not suitable for all cases, as it has a number of limitations and is associated exclusively with the preparation of the company to enter a new market and conduct marketing activities. No other activities, except advertising and promotion of a particular foreign (own) business representative office can not engage in.

The purpose of representation is to prepare and acquaint the target audience with the goods or services, their advantages and peculiarities or to receive feedback from the market in advance. Such scheme allows to “warm up” the interest of the client and, after the full launch of business, to reach an optimal level of sales quicker.

The procedure for setting up a representative office involves registration in the Register of Representative Offices of Foreign Entrepreneurs (Rejestr przedstawicielstw przedsiębiorców zagranicznych) and payment of a 1000 PLN stamp duty for registration.

Since the representative office does not conduct any commercial activities (sale of goods/services), it does not pay any taxes on income of such type of business.

Which option for opening a business in Poland to choose?

When planning to open a company in Poland and obtain a residence permit, a potential entrepreneur should decide on the form of economic activity. After all, both the cost of doing business and the procedure for its registration depend on it. Also the type of legal entity affects the profit tax in Poland and the personal responsibility of the owners for the obligations of the firm.

As a result, the choice of legal form affects the functioning and efficiency of your company, as well as the final costs of taxes. Therefore, even before registering a company, it is worth considering and choosing the most profitable type of business for you.

The Polish law provides for such legal forms of business:

• Individual, private/individual entrepreneur (Jednoosobowa dzialalnosc gospodarcza);
• Partnership company (Spolka partnerka);
• A simple society (Spolka cywilna);
• Limited company (Spolka komandytowa);
• A general society (Spolka jawna);
• Limited Liability Company (Spolka z ograniczona odpowiedzialnoscia);
• Joint-stock company (Spolka akcyjna).

The following table provides a comparison of the forms of doing business and their main objectives. A detailed study of this data will allow you to choose a suitable option of business immigration to Poland. You can download the table at this link.

LLC – spolka z ograniczona odpowiedzialnoscia is very popular among foreign entrepreneurs – it is in this form (according to official statistics) more than 80% of all companies are registered. Such a business in the Republic of Poland makes it possible to conduct virtually any economic activity, which does not contradict the current legislation. We at Uniconsulting.group are ready to help you with registering a company in Poland, including a personal development strategy for your company.

Facilitated option: Business start-up model: “business incubator in Poland

This option is preferred by entrepreneurs in IT and related fields. It not only allows you to organize your business, but also helps reduce the initial investment of funds. In addition, if necessary, it can be “wound up” literally within a couple of days.

Business incubators are intermediary companies between entrepreneurs and their clients. They help with financial, tax and/or legal issues. There are several business incubator companies in the Republic of Poland. Among Russian-speaking entrepreneurs the two most popular are “Moja Firma” and “Twój StartUp“.

A business incubator is the best choice, including testing in the market of the following services:

• programming and various IT projects;
• SAAS software services;
• Web design and website maintenance;
• photographers.

A simplified scheme of cooperation with such a company is as follows:

1. After signing a contract with an incubator, the company gives the entrepreneur a sub-account through which all financial business activities will be conducted. Legally, the incubator takes you on.
2. The company pays all necessary taxes and fees on the money received into the account, and the entrepreneur only has to withdraw the net income.

It is worth noting that working through a business incubator gives access to all the necessary tools:

• qualified accounting and legal services;
• a bank account with the possibility of receiving payments from clients (not only Polish, but also from other EU countries);
• Paypal account to facilitate international payments;
• social insurance, which means free medicine;
• The businessman can receive consultations on issues related to business activities.

Most often this type of business start-up is chosen to test business ideas in the “field” and a simplified procedure (since the incubator takes care of many things) to obtain a residence permit on the basis of your work in the company.

However, in some cases, business incubation is not suitable because it does not optimize costs. Virtual representation is not an option for such areas as:

• cafes and restaurants;
• sale of a variety of goods;
• import of a variety of products;
• complex schemes of interaction and partnership.

Another disadvantage of this scheme of work is the lengthy approval of contracts and invoicing of counterparties. All contracts when working with clients from your side are signed on behalf of the business incubator. This means that the manager assigned to you will double-check all legal documents before signing them. And such an essentially simple procedure can drag on for days.

Taxation in Poland

In the Republic of Poland there are 13 types of taxation approved by law. Naturally, you will never pay more than half of them, so let’s look at the main ones. The tax system in Poland, as in most other countries, provides for differences in the amount of fees for local entrepreneurs and foreign companies doing business in this country. Now let’s look in detail at the main taxes when doing business. We talk about the main taxes here:

CIT (Podatek dochodowy od osób prawnych, corporate income tax or income tax)

In 2021 it is 19%, but for legal entities whose annual turnover does not exceed €1.2 million, there is a preferential CIT rate of 9%.

The CIT can be paid monthly or quarterly – this does not change the rate.

Tax is imposed on the amount of dochód (income for a legal entity, as we call it). It sounds a bit paradoxical when translated from Russian, but it is the difference between income as we understand it (przychód) and the company’s expenses (koszty). For example: the company earned 1000 zt and spent 500 zt. Accordingly, the net profit was 500 zt, it is from this amount you pay tax of 9%, that is 45 zt total cleared profit from the company tax was 455 zt.

VAT rate in the Republic of Poland or VAT (Podatek od towarów i usług)

The basic rate of VAT Podatek od towarów i usług is 23%. It is commonly referred to as the Latin abbreviation VAT. The state provides for a reduced interest rate of 8% or 5%, depending on what kind of activity the firm is engaged in in Poland. Taxes with a reduced rate of 8% apply to:

• print media, excluding publishers that produce thematic newspapers and magazines;
• the agricultural services industry;
• the pharmaceutical industry;
• construction business;
• activities related to ticket sales for concerts, festivals and other cultural events

Legislatively, the Republic of Poland, like any other state, aims to collect taxes from businesses as efficiently as possible, but “white schemes” of how to minimize them – exist here too. For example, you have to pay VAT of 23% on a packaged stick of sausage, but if you cut it up and pack it on a plate, VAT will be 8%, because it is a cooked product. We talked about it in detail in the video:

The following types of goods are subject to a minimum 5% VAT in Poland for entrepreneurs:

• groceries;
• confectionery and pastries;
• books;
• specialized thematic publications.

When exporting Polish goods and services to the European Union and other countries, there is a 0% VAT rate.

PIT (Personal Income Tax)

Taxation in Poland 2022 provides for individuals to pay a portion of their income if it exceeds the annual non-taxable minimum of 3,091 PLN. According to the law, foreigners who stay on the territory of Poland for more than 183 days in one year become tax residents.

If they exceed the nontaxable minimum, they are subject to an 18% tax rate (up to PLN 85,528 in annual income). If an annual income exceeds the amount of 85,528 PLN, a 32% tax rate takes effect. The calculation is as follows: (18%*85,528 PLN) +32%*the amount exceeding 85,528 PLN.

Tax on bank income (podatek od zysków kapitałowych)

People say “Bialka tax”. The initiator of the introduction of such a tax was the ex-clave and former Minister of Finance of Poland Marek Bialka. It amounts to 19% and is levied by the bank in charging interest on deposits, dividends, loans, as well as to the profits from investments.

Other state taxes and fees

In addition to VAT, the category of podatek pośredni includes the following fees to the budget of the country:

• excise tax on alcohol and tobacco products;
• tax on cars with engines over 2,000 ccm;
• tax on gambling businesses;
• other.

You can read more about these fees, excise taxes, and permits here.

The category of direct (podatek bezpośredni) includes such compulsory state taxes:

1. To inherit or donate.
2. To carry out agricultural activities.
3. Forestry.
4. Real estate.
5. On movable transport property.
6. Tonnage tax.
7. For development and extraction of certain types of minerals.

Separately, it is worth mentioning the tax in Poland, which is levied upon entering into various civil legal relations (podatek od czynności cywilnoprawnych). By law, such payments must be made by individuals and legal entities entering into various kinds of agreements and transactions, such as donations or the purchase and sale of movable and immovable property. The rate of this tax depends on the type of agreement and, in most cases, does not exceed 1%-2% of the contract amount.

Reporting to a Polish firm

Legislation of each state has its own peculiarities, so the successful operation of the company in Poland requires the service of a qualified accountant and preferably a Polish lawyer. It can be a specialist who knows the Russian language, but has a Polish diploma, work experience and insurance against risks associated with the conduct of its activities.

As we have mentioned, the main taxes in Poland for individuals and legal entities (not counting ZUS) are CIT (tax on profits), PIT (personal income tax), VAT (value added tax, VAT).

The following reports and forms must be filed when conducting business activities:

• income tax declaration CIT;
• document on personal income tax withheld from the salary of an employee – PIT-11;
• Monthly VAT return – VAT-7

All annual reports must be sent to Urząd Skarbowy (tax office) by March 1.

The accountant carries out the posting of all primary documents and invoices. It is his responsibility to submit all required reports on time, as well as to contact the US – Urząd Skarbowy tax office, if necessary.

This does not provide for acts of work performed. Also, no invoices are signed (the tax authorities themselves check the authenticity of the papers), and no seal is placed. Sometimes there are counterparties that require a signature and seal. Also, funds transferred from the bank account to the cash desk and vice versa are limited to 15,000 zt per month. The only condition is to provide documentary evidence of these transactions.

Small and medium-sized businesses in Poland mostly use the services of outside accounting companies, so they do not have such specialists in their staff. It should be taken into account that an external accountant does not make payments on invoices – this is done by the representative of the firm.

Annual report for legal entities

Sprawozdanie finansowe must be done once a year. This is analogous to the annual report for LLC. It is mandatory for all legal entities in Poland. An important point – all board members must sign the annual report physically or with their own electronic key. After that it can be sent to the tax office. Usually the preparation of such a report is delegated to an accountant.

Tips and tricks

In general, business in Poland in 2023 and in the coming years will be based on the same principles as in other developed countries. To begin with you have to decide – with the product (product/service) you choose to enter the Polish market. Answer the question: what value and solution of what problems can you provide to Polish consumers? Meeting the immediate needs of customers, a high level of service and a good combination of price and quality of the product or service is the key to the success of private enterprise in Poland.

How to start a business in Poland? Step #0

For an effective launch of your firm, careful preparation is necessary, consisting of the following steps:

1. A complete analysis: of the market, seasonality of the product, existing competitors, price levels, etc. You can take the 5P technology as a basis (give them our template)
2. Development of a business strategy with an estimate of the starting amount, total costs and size of investments.
3. Development of a marketing strategy with planning of the scheme of doing business in Poland from scratch, finding customers and making profit.
4. Pilot launch or test sales.
5. Registration and opening of a firm in Poland.
6. Start of active marketing, sale of goods or services, further development of the firm.

The nuances of working with hired employees

Of course, an important issue when running a business is hiring employees for your Polish firm. That is why we have prepared some useful articles for you:

What the hiring process looks like

All about the work contract in Poland / Umowa o dzieło

Some useful videos on the subject:

How to withdraw money from the Polish business and do it with minimal losses

Understand how it works in video format:

In the previous sections, we dealt in detail with what is needed to start a business and what taxes will have to be paid. And how to withdraw money from the Polish business, because the task of the company is to generate profit for its founders. So now a little about how you can withdraw money from a business in Poland. Among the main options there are 4:

• Payment of remuneration to members of the board of the company. Here everything is simple, the tax on the amount withdrawn is 19%.
• One-time work for a company. This is a one-time contract with a natural person to provide a service for the company. It can also be the founder of the company. The tax here is 18%. In Polish: umowa o dzieło.
• The same one-time contract with an individual, but for the work on which the copyright applies (writing a book, a program code, etc.). The advantage of this method is the 9-10% tax. In Polish it sounds like: umowa o dzieło z przeniesieniem praw autorskich.
• Permanent work for a company. There are different variants of employment. We talked more about the taxes that you have to pay in this case in the section on taxes. In general, they amount to an average of 40%.

There are several points in the Polish tax code that help minimize taxes for legal entities. One of them is understanding the concept of double taxation.

The state goes as far as possible to those who want to invest in their firm. Therefore, just like in any other civilized country, all funds that are written off to the firm’s expenses are not taxed. You bought a car, a computer, furniture, pay rent (commercial) – by writing it off as a company expense you reduce your tax burden. This can also include loans, leases issued to the legal entity of your company in Poland.