Poland is quickly becoming one of the best legal offshore jurisdictions to set up an international business in the form of a Poland Limited Liability Company (LLC). The company codes can be found under the Polands' Commercial Companies Codes. There are several different company structures in Poland however the LLC offers the most benefits for non-residents. Poland has maintained low corporate tax rates and are now planning to implement a zero percent corporate tax rate. This, among various other advantages, make it an ideal up-and-coming jurisdiction to consider.
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The following is required to complete the registration of a Poland LLC:
Once the required documents have been obtained, they should be filed in the commercial registry, and the LLC will officially become a legal entity upon acceptance.
The articles of incorporation must include:
Currently, the corporate tax rate in Poland is a flat 9% on profits up to EUR 2 million, and 19% for all profits above that. This is already on the low side. However, from 1 January 2021, Poland will introduce a 0% corporate tax rate on all profits below PLN 100 milllion (approximately EUR 22 million). These major tax reductions which will be coming into effect are an incentive to open an offshore business in Poland now. It is not clear whether the current dividend tax rate of 19% will also be subject to reduction.
As is always the case, citizens of the US and other countries which tax their citizens on all worldwide income must declare their income to their local tax authorities and will be subject to income tax in their own jurisdiction. This means that a low-tax offshore company structure which is available in Poland is especially beneficial for those who are tax residents of a low-tax jurisdiction themselves which do not tax their citizens heavily on offshore income.
In general, Poland is not known for its high degree of anonymity and confidentiality compared to other popular offshore jurisdictions. The company records which are filed in the Commercial Registry are publicly viewable, which includes the names of the shareholders and directors. However, nominee shareholders/directors can be used to obtain confidentiality.
Company’s are required to disclose information about their annual profits/losses and other relevant financial records. Poland banks do take client privacy seriously, and so there is a certain level of nondisclosure assured in Poland.
Shares are issued and denominated by a nominal value in PLN. The minimum issued share capital is PLN 5,000. Shares can be 100% foreign-owned. The Articles of Association stipulate the total issued share capital, the number of shares, and nominal value of each share.
Minimum required initial share capital is PLN 5,000 (approximately EUR 1,120).
A minimum of one shareholder is required to form a Poland LLC. There is no maximum number of shareholders. The shareholder can a legal entity (natural persons and/or corporate bodies are permitted) of any nationality. The only restriction is that if there is only one shareholder, it cannot be another single-shareholder company.
In addition, a Board of Directors should be appointed with a minimum of one director. The directors can be appointed temporarily (one year or more) or indefinitely. All rules and requirements pertaining to the directors should be stipulated in the Articles of Association. The shareholder and director can be the same one person. However, in this case, all resolutions must be signed in the presence of an authorized Polish notary.
The LLC may also appoint a Supervisory Board whose duties will be specified in the Articles of Association. Their role is slightly different to that of the directors, and they can act as mediators to resolve any conflicts between the board of directors and the company shareholders.
There are no significant trading restrictions.
The Polish Companies’ Code governs Polish LLC’s and sets out all relevant rules and regulations.
The Polish Legal system follows the Civil Law tradition.
A Poland LLC is regarded as a separate legal entity from its shareholders and directors. It has all the same powers and rights as a natural person. It therefore has the power to enter into legal contracts, hold property and assets, and engage in lawsuits in its own name. Shareholders are exposed to no personal liability, which means their liability is limited to their share contribution in the company.
An annual shareholders meeting is required to deal with the important company issues such distributions of profits/losses, major company decisions, matters relating to company debt and/or loans, purchases and/or sales of real estate, and various other crucial matters.
The Companies’ Code stipulates that the meeting should be held at the company’s registered office, unless the Articles of Association have designated a different location in Poland. Shareholders do not need to physically attend the meeting and can instead appoint a representative with Power of Attorney to attend.
Poland LLC’s must maintain a local registered office address and local agent in Poland. Virtual offices are allowed so as to simplify the process and minimize costs.
A company secretary is not required, but the company is required to hire a local registered agent to represent the company in Poland.
Polish remains the standard language for all legislation, corporate documents, and is to be used whilst preparing financial statements.
Poland LLC’s are required to report their annual financial statements, distributions, and other significant changes such as changes in ownership with the commercial registry. The company may be subjected to auditing in certain cases.
There are no exchange controls.
Annual financial statements are required. The accounting requirements are laid out by Poland’s Accounting Act of 1994. This act stipulates the standards for maintaining LLC’s annual accounting records and financial statements. These statements must show full records of the company’s profits/losses, revenue, expenses, and debts for each fiscal year. Financial records must be maintained in Polish and denominated in the Polish Zloty (PLN).
Yes, shelf companies are available for purchase. However, registering a company from scratch is so quick, affordable, and easy, that shelf companies are not strictly required.
A Poland LLC can be incorporated incredibly quickly. The process can be completed in as little as one business day, and it can be done entirely online.
The name of the LLC must end with the abbreviation “sp. z.o.o.”, which stands for Spółka z ograniczoną odpowiedzialnością (Polish for “Limited Liability Company”). The name selected should be unique, should not be deemed offensive or inappropriate, and should not include any terms which require a special license/permission (e.g. insurance, reinsurance, bank, group, etc.).
The company name can be in any language provided the Latin alphabet is used.
Yes, Poland has signed Treaties of Double Taxation Avoidance with numerous countries, including the US, the UK, New Zealand, Canada, Australia, Singapore, China, most of the European nations, and many more.
The license registration fee is approximately PLN 600 (about EUR 135).
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