Poland gives foreign companies and entrepreneurs full freedom to conduct business. You can establish a subsidiary, open a branch, acquire shares in an existing company or register a sole proprietorship. This guide sets out the available business forms, the conditions to meet, and points to consider regarding tax, hiring and registration.
Why Poland can be an attractive place to invest
- Location: in the center of Europe, with convenient access for expansion in multiple directions.
- Market: nearly 40 million people, creating a substantial market for goods and services.
- Talent: a developed education system and access to qualified people in IT, medicine, management, law and industry.
- Global business presence: major global companies have subsidiaries or offices in Poland. Polish family businesses are growing and can be valuable partners.
Who can start a business in Poland
EU and EEA citizens
You may conduct business on the same terms as Polish citizens, without additional formalities.
Citizens from outside the EU
You may start a business in Poland if you hold:
- a permanent residence permit;
- a temporary residence permit;
- refugee status; or
- a valid Pole’s Card (Karta Polaka).
Foreign companies
For a foreign company, the process can be straightforward. You can:
- open a branch or representative office in Poland;
- establish a subsidiary; or
- acquire shares in an existing Polish company as an investor or to take control.
These options are available on the same terms as for Polish entities.
Forms of doing business in Poland
Sole proprietorship
This is the simplest form. You run the business personally. It is suited to smaller ventures where the risk is not high.
Commercial companies
For a larger venture, three common forms are:
- Limited liability company (sp. z o.o.): its operating principles are similar to limited liability companies in Western Europe. It is the most commonly chosen form.
- Joint-stock company (S.A.): comparable to joint-stock companies in other countries. It can list shares on a stock exchange through an IPO.
- Simple joint-stock company (P.S.A.): designed with startups and technology companies in mind. It combines features of a sp. z o.o. and an S.A. with less formalized operating rules. This relatively new form is gaining popularity.
Branch and representative office in Poland
Branch of a foreign company
A branch is an organizational unit that may conduct business within the same scope as the head office. You do not need to establish a separate company.
To register a branch:
- file an application with the National Court Register (KRS);
- appoint a person to manage the branch;
- file the registration documents of the parent company with the KRS; and
- provide proof of the company’s registration in its home country, if applicable.
The procedure is not complicated or time-consuming.
Representative office
A representative office may not conduct business activity. Its activity is limited to advertising and promotion of the parent company. It must be entered in a dedicated register of representative offices. In practice, companies rarely establish standalone representative offices today.
Subsidiary in Poland
If a foreign company plans full operational activity in Poland, a subsidiary is usually the best option.
How it works:
- you form a new sp. z o.o. or joint-stock company;
- the foreign company takes shares in the new company;
- the subsidiary operates on the same terms as any other Polish company; and
- as a shareholder, you may appoint the management board and direct operations and financial policy.
National Court Register (KRS)
The KRS is a public register of companies in Poland. It is available online free of charge.
The KRS includes:
- management board details;
- supervisory board information, if one exists;
- shareholder information; and
- annual financial statements.
Changes to report on an ongoing basis:
- changes to the management board;
- amendments to the company’s articles; and
- changes to share capital.
The KRS supports commercial transactions by providing information about representation and financial condition. It can also help you understand a company’s ownership structure before making an investment decision.
Hiring employees in Poland
Labor market
- Poland has a diverse economy and workers with experience across many industries.
- Universities educate IT specialists, medical professionals, analysts and other professionals.
- Global corporations create access to experienced managers, lawyers and e-commerce specialists.
- English is a required school subject, which can support communication with foreign entrepreneurs.
- Recruitment options include job portals, university onboarding programs, and local and global recruiting firms.
Forms of employment
| Form | Description |
|---|---|
| Employment contract | The standard form. It provides employees with broad rights, including public healthcare, minimum pay and mandatory paid leave. |
| B2B cooperation | Increasingly common, with lower social insurance contributions on both sides and higher net pay for the contractor. It is often chosen by IT specialists, lawyers and corporate employees. |
Taxes in Poland
Corporate income tax (CIT)
Poland offers a relatively low CIT rate. Under the most favorable option, it may be as low as 5%.
Dividend tax
- The standard rate is 19%.
- Depending on international agreements signed by Poland, tax within a holding structure may be 0%.
- This may allow a foreign entrepreneur to avoid dividend tax in Poland and account for it only in the home country.
VAT
- Goods and services are generally subject to VAT.
- Not every entity is required to pay VAT.
- An exemption is available while annual turnover does not exceed PLN 200,000.
- In certain situations, VAT is not due, such as on exports, or may be refunded.
Read more about taxes that apply in Poland.
Where to locate a business in Poland
The right location depends on the type of business, but many companies choose Warsaw.
Why Warsaw:
- it is Poland’s capital, with more than two million residents;
- it is a business and financial center in Central and Eastern Europe;
- it offers a wide range of office space; and
- it provides access to specialists across industries.
If you want to learn more about business opportunities in Poland, contact us.
Frequently asked questions
Which form of entry into the Polish market is often chosen: a branch, a subsidiary or an acquisition? For full operational activity in Poland, a subsidiary, most often a sp. z o.o., is usually the preferred option. You form a new company, take shares and operate on the same terms as other Polish entities. A branch may suit a company that wants to operate within the same scope as its head office without establishing a separate company. Acquiring shares in an existing Polish company may suit an investor or a buyer seeking control of an operating business.
What is the difference between a branch and a representative office of a foreign company in Poland? A branch may conduct business within the same scope as the foreign head office and must be entered in the KRS. A representative office may not conduct business activity. It is limited to advertising and promotion of the parent company, must be entered in a separate register and is rarely used as a standalone structure today.
How do you register a foreign company’s branch in Poland? The process requires an application to the KRS, appointment of a branch manager, filing the parent company’s registration documents, and proof of registration in its home country if applicable. A separate company is not required to start branch operations.
Can a foreign company hire in Poland on a B2B basis instead of using employment contracts? B2B cooperation is increasingly common and often chosen by IT specialists, lawyers and corporate employees. Compared with an employment contract, it involves lower social insurance contributions on both sides and higher net pay for the contractor. An employment contract, in turn, provides broad rights such as public healthcare, minimum pay and mandatory paid leave.
What taxes should a foreign entrepreneur consider when starting a business in Poland? Three main areas are CIT, dividend tax and VAT. Under the most favorable option described here, CIT may be 5%. Dividend tax is generally 19%, but may be 0% within a holding structure depending on international agreements. VAT generally applies to sales of goods and services, while an exemption is available while annual turnover does not exceed PLN 200,000.
