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Doing business in Poland. Forms of economy activity in Poland

For the people starting their business in Poland most important is the legislation related to allowed methods and forms of the economy activity in Poland. Since 1989, the political changes in Poland, there was serval acts related to the economy activity in Poland.

In consequence of legislation changes there remain two basics acts which state this issue:

  • Act on economy activity freedom (Polish: Ustawa o swobodzie działalności gospodarczej), and
  • Commercial Companies Code (Polish: Kodeks Spółek Handlowych).

Those two acts regulate the issue of forms of economy activity in Poland by creating three main forms:

  • Single-Man Business (PL: Jednoosobowa działalność gospodarcza)
  • Partnership (PL: Spółka osobowa)
  • Company (PL: Spółka kapitałowa)

Single-Man Buisness

This form of the economy activity is regulated in Act on Economy Activity Freedom, and is most basic form. The main idea of this form is that, as its name says, the natural person becomes also an businessman in scope of Polish Law, and provides an economy activity in his own name. Most important for this form is that there is no any new entity. Natural person who already existed just converts itself into a businessman, and can on the market act as consumer (if for example he buys something for his own needs not related to his business activity), and as businessmen, but in both form using his own name.
This form is also the fastest form to start business in Poland. Registration in the Central Record and Information about Economic Activity (CEIDG) is digitalized, and it is only necessary to sign the final document. Since the registration Businessmen can starts his activity.

However this form has also its disadvantages. In this form businessman acts as himself, so in case of failure of business there is no any company which bankrupt, but businessman must pay on himself. In this form there is also no division of the risk between partners or shareholders, because Single-Man Business is undivided and all risk, costs, but also are profits are burden and gain of one man who is a businessman.

In Poland we can often meet with the Civil Partnership (Spółka Cywilna) which also usually uses shortcut S.C. – Civil Partnership is not a form of the Economy Activity it is a agreement between two or more persons which do not need to have a business activity on its own. Civil Partnership had no legal personality, and do not act as independent businessman, each of its partners acts on his own business, and Civil Partnership agreement is important only for its partners. However this agreement must be registered in CEIDG.


Second type of the form of the economy activity in Poland are Partnerships. Those agreements form an new entity of law, which can act on its own as a businessman, what is most important it has its own assets which can be divided between Partners only after the dissolution of the partnership. This form is regulated in Commercial Companies Code, and we got four types of Partnership:

  • Registered Partnership (PL: Spółka Jawna, Sp. J.)
  • Professional Partnership (PL: Spółka Partnerska, Sp. P.)
  • Limited Partnership (PL: Spółka Komandytowa, Sp. K.)
  • Limited Joint-Stock Partnership (PL: Spółka Komandytowa-Akcyjna, SKA)

Those are still not a legal persons but partnership may, in its own name, acquire rights, including ownership of immovable property and other rights in rem, incur obligations, sue and be sued. Also, what is important, Partnership acts under its own name with addition of the Partners names.
What should be pointed out is that the Professional Partnership is reserved for the specified scope of Partners which perform a specific form of business activity i.e. Solicitors, Barristers, Notary, but even an Architects or Nurses.
Other types can be formed by any person, and it do not need to be a businessman by any of partners. Interesting form of Partnership is Limited Partnership which divide Partners between General Partner (which gain all rights and obligation), and Limited Partner (which is limited in his rights but also in his obligation), this form of Partnership is very often used for the tax optimization in Poland.

Acting in form of Partnership requires and registration in National Court Register, and Partnership may act as businessman since the day that registration is completed. If Partners acts before the registration is completed they are obligated to repair any damage on their own.


Last form of the economy activity in Poland is Company. Those similar to Partnership are regulated in Commercial Companies Code. Companies are highly organized, and most complicated of all economy activities type, but also had the biggest credit trustworthy, and highest prestige. In Poland there are three types of the companies:

  • Limited Liability Company (PL: Spółka z ograniczoną odpowiedzialnością, Sp. z o.o.)
  • Joint-Stock Company (PL: Spółka akcyjna, S.A.)
  • Societas Europaea (SE)

The last one is an EU form of the company, which is common for all EU countries.
Limited Liability Company and Joint-Stock Company, are both legal persons, so they are an individually legal entities which act on their own. What is most important in case of companies assets of the company and assets of shareholders are completely separate, Shareholders are obligate to pay on the share capital, or supplementary charges, but they do not hold any other risk of company activity than loss of their future income.

Companies require their share capital which must be paid as they start they activity. Minimum share capital are regulated in Commercial Companies Code and it is 5 000 PLN (around: 1 180 EURO) for Limited Liability Company, 100 000 PLN (around: 23 570 EURO) for Joint-Stock Company, and 120 000 EURO for SE.

What is more important as an legal persons all companies need their bodies. There are three types of bodies ownership body (General Shareholders Meeting), management body (Board), and control body (Supervisory Board). Limited Liability Company generally is only obligated to have its ownership and management body, Joint-Stock Company has to have all three of them without exception. Companies acts by their Board, but with own assets and own name.
All information about companies must be registered in the National Court Register. However unlike the partnerships Company may act since signing it act as the company in organization.

Those are basic information about the forms of the Business Activity in Poland which may allow you to create a business plan for the economy activity in Poland. For the further assistance and information we are glad to invite you to one of our offices in Katowice (Warszawska Street 17) or Warsaw (Aleje Jerozlimskie 96). One of our specialist will provide you an necessary information and help you register an Single-Man Activity, Partnership or Company in Poland.

Doing business in Poland. Audit of financial statements

In accordance with Article 64 of the Accounting Act the annual consolidated financial statements of groups of companies or partnerships as well as the annual financial statements of the following are subject to audit and publication, provided that they continue their operations:

  1. banks, insurance and reinsurance companies;
  2. credit union
  3. undertakings operating under the legal regulations on the organisation and operation of pension funds;
  4. joint-stock companies, save for companies under organisation as of the balance sheet date;
  5. other undertakings that met at least two of the conditions listed below in the preceding financial year for which the financial statements were prepared:
  • average annual employment calculated as full time jobs amounted to no less than 50 people,
  • total balance sheet assets at the end of the financial year amounted to no less than the Polish currency equivalent of EUR 2,500,000,
  • net proceeds from sales of products and goods and from financial operations for the financial year amounted to no less than the Polish currency equivalent of EUR 5,000,000.

In accordance with Article. 3 Section 1 point 45 of the Accounting Act consolidation is understood as combining the financial statements of undertakings comprising a group of companies or partnerships, by aggregating the respective items in the financial statements of the parent and subsidiary undertakings, taking into account the necessary exclusions and adjustment.
Consolidated financial statements are the financial statements prepared for a group of companies showing the presentation of each company separately, intra-group transactions and the situation after consolidation. Such reports are useful primarily for the owners of the group, which depends on reviewing the whole of the situation in the group. The obligation to prepare consolidated financial statements is regulated in the Chapter 6 of the Accounting Act. The provisions of Article. 55-63d define the purpose, scope and methods of reporting.

Annual consolidated financial statements of the group include the data of the parent company and its subsidiaries at all levels, regardless of their geographical location, summarized in such a way as if the group was one entity.

The consolidated financial statements consist of:

  1. the consolidated balance sheet;
  2. the consolidated profit and loss account;
  3. the consolidated statement of cash flows;
  4. statement of changes in consolidated equity capital;
  5. additional information, including introduction to the consolidated financial statements and notes and explanations.

A report on the activities of the group is an integral part of the annual consolidated financial statements. It must included information about shares held by the controlling company, entities in the group and persons acting on their behalf.
Parent company which has its head office or place of management in Poland is required to prepare consolidated annual financial statement.

The parent company may not present consolidated financial statements if the required identified in Article 56 will be fullfiled
The consolidated financial statements do not need to prepare also when the parent company of higher level owns 100% of the unit, where they are not taken into account the shares in the entity held by members of its administrative, management or supervisory law or in respect of the obligations set out in its memorandum or articles or when the parent higher level has at least 90% of the shares of the unit, and the other shareholders of the entity approved the decision not to consolidated financial statements.

This exemption can be applied in cases where the two of the following conditions:

  1. the parent company of higher level will cover the both consolidated subsidiary of the parent company which is not prepared consolidated financial statements and all of subsidiaries to be consolidated by the parent company;
  2. manager of the parent company which not preparing the consolidated financial statements fulfill the obligations to submit consolidated financial statements and the consolidated annual report of the parent company;
  3. the parent company which not preparing the consolidated financial statements disclose in the notes listed in the Annex to the Accounting Act.

The auditor in its examination verifies the documentation on the basis of the facts and controls processes related to accounting and reporting organizations then before formulating opinions, recommending necessary changes and help find solutions to problems identified.

The examination shall take determine whether the financial statements as a whole and form the basis for the preparation of accounts are free of irregularities involving the omission or distortion of the relevant information and whether it can be regarded as reliable the information contained in this report.

Doing business in Poland. Registration of economic activity

All entrepreneurs in Poland are subject to being entered either in the Central Registration and Information on Economic Activity (CEIDG) or the register of entrepreneurs of the National Court Register (KRS), so in order to perform certain types of economic activity in Poland it may be obligatory to undergo a registration procedure. The registration process differs depending on the form of business activity.

In order to successfully start your own business it is obligatory to comply with the correct procedure. The registration is an essential part  of it and should be dealt with precisely according to the regulations to ensure that no problems or delay will take place. Both self-employment and establishing a commercial company have some similarities with regard to registration, but it is essential to take notice that despite the similarities the registration in both aforementioned cases is an entirely different process subject to separate procedures.

Natural person’s economic activity

If you are a natural person and are interested in starting a small business or becoming  self-employed in Poland then the rules for establishing such economic activity are set out in the Act of 2 July 2004 on freedom of economic activity(ustawa z dnia 2 lipca 2004 r. o swobodzie działalności gospodarczej, Dz.U. 2004 Nr 173 poz. 1807 ze zm.). Among other regulations it contains provisions on procedures required for establishing, running, suspending and ceasing economic activity.

According to the aforementioned Act, economic activity consists in gainful production, construction, commercial and service activity, prospecting and identifying mineral deposits, as well as professional activity pursued in an organized and continuous manner. Whereas an entrepreneur is a natural or legal person and organizational unit which is not a legal person, but enjoys legal capacity pursuant to a separate Act, that conducts economic activity on his/her/its own account.

Entrepreneurs are legally obliged to conduct economic activities while upholding the principles of fair competition and having respect for good practices and justified interests of the consumers.

Certain types of economic activity such as selling alcohol or transporting people/goods, may require to obtain a license, permission or entry into the register of regulated activity.

In Poland some foreigners are allowed to commence economic activity based on the same principles as polish citizens, without any additional restrictions. This applies especially to foreigners who are citizens of the European Union’s countries or foreigners who obtained special kinds of permits eg. permanent resident permit. In general among these people every person is equally free to commence, pursue and cease economic activity in compliance with the requirements set out in legal provisions.

In order to start a business by commencing economic activity a natural person is required to register which is done by filling out and submitting the application to entry into the Central Registration and Information on Economic Activity (CEIDG).
The CEIDG registration can be done either via the Internet on the CEIDG website or the registration form can be submitted in person or by mail in the local authorities office(Urząd Gminy, Urząd Miasta).

The entrepreneur is entitled to start the economic activity on the day on which the application for entry in CEIDG is submitted, but it is also possible to indicate in the application form a later day of commencement of the economic activity.
In case of the application being incorrect either the electronic CEIDG system should notify about the input of incorrect data or the local authorities should call for amending or supplementing the application within 7 working days. The latter is the only possibility of notification for the applications submitted in person or by mail.

When filling out the registration form it is obligatory to provide information necessary to complete all of the form’s integral parts such as:

  • the statement on the lack of prohibitions pronounced with regard to the applicant, made under pain of criminal liability for making a false statement;
  • entry or change to entry in the national official register of national economy entities (REGON);
  • identification or update referred to in legal provisions on registration and identification of taxpayers and withholding agents- which is essential for obtaining the tax identification number(NIP);
  • notification or change of contribution withholding agent within the meaning of legal provisions on the social insurance system, or acceptance of statement on continuing social insurance for farmers within the meaning of legal provisions on social insurance for farmers;
  • acceptance of the entrepreneur’s statement on the choice of the form of personal income taxation, or application for taxation in the form of advance payment.

Apart from the aforementioned registration form the entrepreneur should in general also submit an application for relevant insurance in the Social Insurance Institution (ZUS) within 7 days from starting the economic activity.
If the economic activity requires entrepreneur to become a VAT payer, then in order to be registered as an active VAT taxpayer the entrepreneur is also obliged to submit the VAT-R at the latest on the day preceding the day of starting the sale of VAT taxable goods or provision of VAT taxable services. The form for registration of the entrepreneur for VAT purposes should be submitted to an appropriate tax office.

Commercial company formation in Poland

The procedure of setting up your business in Poland by registering a brand new company may differ depending on the legal form of the company. In general it will be required to sign a company agreement in the form of a notary deed, open a bank account for the created legal entity, register the company in National Court Register(KRS) while filling out the paperwork related to REGON, NIP, and social insurance. It is also important to remember about registration for VAT purposes if the VAT will be applicable to the economic activity commenced by the newly created company.

The foreigners who want to start a business in Poland, but who are not subject to the same principles as the polish citizens regarding the commencement of economic activity may start and conduct economic activity exclusively in the form of:

  • limited partnership;
  • limited joint stock partnership;
  • limited liability company;
  • joint stock company.

The National Court Register is a centralized, computerized database comprising of three distinct registers:

  • The register of entrepreneurs;
  • The register of associations, other social and professional organizations, foundations and public healthcare institutions;
  • The register of insolvent debtors.

For each entity a separate register file is being kept in the KRS by the registration court and any interested party can view the register file without limitations unless the law states otherwise.

As it was already stated before starting the registration procedure it is mandatory to open a company’s bank account. The company registration by itself can be performed by a legal representative so a travel to Poland by the company founder may not be required. In such case a power of attorney should be delivered to the appointed representative so that he can file at KRS for a company registration.

The company in Poland is registered in the registration court with jurisdiction over the legal seat of the entity that is being established. Filing the motion for registration of the company in KRS can be done via mail, in person or electronically via the Internet. The registration via the Internet is subjected to some restriction and may not be suitable in many cases eg. not all of the forms of companies can be created  in electronic registration, and the contribution to the company’s capital is limited to cash contributions.

The newly established companies should be assigned the tax identification number (NIP) and statistical number (REGON) automatically by the registration court. For that purpose submitting additional forms is not mandatory but the applicant while filling out the appropriate registration form should indicate that he has not applied for NIP and/or REGON yet.

After registration of the company, the registry court will send the registration data to appropriate authorities, but it should be noted that additional required information should be submitted to the tax authorities after the registration- namely the NIP-8 form, containing contains supplementary information to those disclosed during the KRS registration, shall be submitted to tax authorities within 21 days after the registration of the company in the National Court Register.

Doing business in Poland. How is the social security system formed

Social security constitutes all means and public activities, by which the society tries to protect its members against the threat of inability of satisfying important and regarded by the most common needs. Social security system ensures its citizens safety. It constitutes a way of a man’s insurance from poverty, in which a man can fall into, because of inability to work or inability to find a job.

The means of social security are: social security (insurance method), social supply (supply method), social help (caring method). Four elements, that are taken into account, when it comes to differentiate these methods are: hedger, the entitled, the finance entities, benefits.

For people who are planning set up a business or for people whose already running it, the most important thing are costs that are a obligatory part of the social security system. This subject will be considered below.
The social security includes old-age pension insurance, disability insurance, sickness insurance, work accident insurance and health insurance. The social security system has also few features, which are: occurrence contribution, common fund, identified risk, detriment and benefit.

Payers are obliged to pay contributions. The Social Insurance Act however does not have the general definition of a payer. In the 4th Article of the 2nd Bill from the 13th of October 1988 of the Social Security System , the persons who are payers are mentioned thoroughly. From the practical point of view, one of the most important payers is an employer, who is one of the payers, according to the Act. The term of an employer is understood much more generally than in the Labour Code. This is an organisational entity, even if it does not have a legal personality, and also a natural person- if these entities take on workers. Employer, understood in this way is a payer in relation to employed workers.

Moreover, an employer understood in this Act is also a person who employs based on the mandatory contract or other contracts with third party (for example contract for specific work, contract of agency). In consequence, he is obligated to pay contributions as well.

The insured persons however are natural persons, who have at least one insurance (old-age pension insurance, disability insurance, sickness insurance, work accident insurance or health insurance). The largest group of the insured are employees. Employees, with some exceptions, come under a mandatory social insurance of any employment relationship.

Besides workers who are employed based on the labour contract, committed to old-age pension insurance and disability insurance are among others:

  • outworkers,
  • persons who are working based on mandatory contract or agreement of agency,
  • persons who are working based on other contracts, which are similar to the mandatory contract, according to the Civil Code rules,
  • persons who are leading non-agricultural business and cooperating persons with them;
  • persons who are on the maternity leave or getting the maternity allowance.

It is also vital that the pupils and the students under the age of 26, who don’t come under compulsory insurances, if they work on the basis of the civil law contracts. Moreover, persons who are not obligated to pay contributions are judges, prosecutors, farmers and some other countries’ citizens, who don’t have a permanent residence in Poland and they work on diplomatic missions, consular posts, missions, special missions or international organisations. They are also volunteers and members of management in trading companies but except of associate.

The maximum annual amount of old-age pension insurance and disability insurance contribution calculation basis is  thirty-fold projected average monthly salary in the national economy which actually is 121 650,00 PLN.

The amount of contributions to the old-age pension insurance, disability insurance and sickness insurance are expressed in the interest rate, which is the same for all insured persons. On the other hand in case of work accident insurance the interest rate is varied and depends on the level of occupational risks.

The interest rates for contributions are:

  • generally 19,52% of calculation basis – old-age pension insurance;
  • 8,00% of calculation basis – disability insurance;
  • 2,45% of calculation basis – sickness insurance;
  • from 0,40% to 8,12% of calculation basis – work accident insurance.

The social insurance contribution calculation basis can be the actual revenue, the declared revenue or the definite amount in the Personal Income Tax Act.

A payer sends contributions with additional formalities no later than:

  • the tenth day next month – for natural persons who pay contributions only for themselves;
  • the fifth day next month – for budgetary institutions;
  • the fifteenth day next month – for other payers.

In Poland, Social Insurance Department is responsible for social insurance in the Ministry of Labour and Social Policy. The Social Insurance Department is especially responsible for developing draft regulations related to social insurance, adapting the Polish social insurance law to EU law and to the standards of the conventions and recommendations of the International Labour Organisation and developing the assumptions of the social insurance policy.

Tekst: Justyna Kowalska

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