Accounting

Duplikat Polish Limited Liability Company

Accounting


Limited Liability Company incorporation in Poland

Polish Limited Liability Company (LLC) — Sp. z o.o. (spółka z ograniczona odpowiedzialnością) is the most popular form of doing business and investing in Poland. Approximately 94 % of foreign investments in Poland are carried out in the corporate form of LLC. Although Polish Company Law provides number of alternative corporate forms - each of them brings some disadvantages (e.g. JSC — high level of bureaucracy, Partnership — no liability limitation). For this reasons investors in Poland most usually select LLCs as their Investment SPVs (Special Purpose Vehicles). 

Why shall I register LLC in Poland ?

Our Polish lawyers usually recommend to invest in Poland this corporate form (Limited Liability Company) for the following reasons:

  • LLC is considered as reasonable compromise between safety (liability limitation) and level of bureaucracy,
  • LLC is fast to incorporate and register in KRS (Polish Company Register), 
  • Taxation of LLC is very beneficial - 0 % of Estonian CIT or 9 % of profits up 2 mln EUR and 19 % for higher profits
  • LLC is flexible for small as well as big investment ventures.

Time required for LLC formation

Time required for Limited Liability formation depends on the chosen mode of incorporation:

  • online company incorporation: 1 — 5 working days
  • notarial incorporation: 1 — 3 months 

Limited Liability Company in Poland — Key Facts

Number of Founder At lease 1 shareholder
Method of incorporation

Signing Articles of Association:

  • at the Notary; or
  • Online via designated portal
Minimum share capital 5.000 zł payable in cash or in kind contribution
Minimum value of each share 50 zł
Taxation of LLC 9 % of CIT for profit up to 2 mln EUR, above 19 %, alternatively 0 % of Estonian CIT
Who can be a Shareholder ? No restrictions. Foreigners may be shareholders. 
Who can be a Director ? No restrictions. Foreigners act as Directors. Directors must have clear criminal record with regards to corporate and business crimes.
Formation time 

Online incorporation 1-5 days or

Notarial incorporation 1-3 months

Auditing requirement

Obligatory if 2 out of 3 conditions are met: 

  • employment exceeds 50 empoloyees
  • assets exceed 2.5 mln EUR
  • revenues exceed 5 mln EUR
Reporting requirement  Obligatory — once a year to KRS (National Court Register)
Liability of Shareholders 

Shareholder hold no liability for Company debts

Liability of Directors 

Directors hold no liability for Company debts on condition they timely report insolvency to the Court

Features of Polish Limited Liability Company

Polish Limited Liability company is an independent legal entity with a separate legal personality from its shareholders.  In practice it mean that it can buy and sell goods, as well as, hold credits and debts on its own name. 

Foreign capital in Limited Liability Company 

EU nationals can establish and run a companies in Poland free of any restrictions. Non-EU nationals can also freely establish and run Polish company, however in some matter they are up to restrictions provided by law. For example Polish LLC Company with more then 50 % of non-EU capital may purchase a real property in Poland only after obtaining permission form the Ministry of Foreign Affairs (or Ministry of Agriculture in case of agricultural properties).

Share capital of Polish Limited Liability Company

Minimum share capital of Polish Limited Liability Company is 5.000 PLN (approx. 1.250 EUR). The share capital may be covered by monetary or non-monetary contributions (in-kind contributions, e.g. ownership of the movable or immovable property). Contribution cannot be provided in the form of services towards the company.

Representation of Polish Limited Liability Company

Polish Limited Liability Company is represented by a the Board Directors. The Board shall consist at least of one person. There is no limit as to number of Directors. Rules of representation can be freely formed in the Articles of Association of the Company. A company may be also represented by regular proxy (pełnomocnik) or a registered proxy (prokurent).

Shareholders Meeting and Supervisory Board of Limited Liability Company

Superior authority of a Polish Limited Liability Company is Shareholders Meeting. A Supervisory Board in Polish Limited Liability company is only compulsory when the share capital is greater then 500.000 zł and the number of shareholders is greater then 25.

Taxation of Limited Liability Company

As every Polish LLC is a separate legal entity, it is taxed by Corporate Income Tax (CIT).
CIT is imposed on the total income from all sources (reduced by deductions) at the rate of 9% for profits up to 2 mln EUR and 19 % for higher profits. Since 1 January 2022 Polish Tax Law provides 0 % tax on profit retention (Estonian CIT). 
Dividends released by the company are taxed separately.

  • If the dividend is released to shareholders who are private individuals — they are generally taxed by withholding tax of 19 %. However dividends released to foreigners (tax residents in other countries) are tax in accordance with appropriate DTT (Double Taxation Treaty).  
  • If the dividend is released to parent company — it may be exempt from dividend tax if parent company owns at least 15 % of the subsidiary’s share capital continuously for at least 2 years and is subjected to unlimited income tax liability in Poland, other EU Member State or other state belonging to EEA.

Liability in Limited Liability Company

The shareholders in Polish Limited Liability are not liable for the company’s obligations, they bear a risk up to the value of shares contributed. Directors of Polish Limited Liability Company may be held liable for the company’s obligations if they fail to file for insolvency within the deadline provided by Polish Insolvency Law (i.e. within 30 days since the company became insolvent). 

Steps necessary to incorporate a LLC company in Poland

  1. Preparation of necessary documents and information regarding LLC 
  2. Signing the Articles of Association of the Limited Liability company at the Notary or online via designated portal
  3. Registration of the company at the Company Register (KRS)

Our Polish corporate lawyers are advising and representing clients in the company incorporation process to make it as simple as possible. 

As a result you of above steps you would get

  1. Your Limited Liability Company will be registered in the Company House (KRS) and will get it KRS number
  2. Your Limited Liability Company will get tax identification no. (NIP) and will be registered as a taxpayer
  3. Your Limited Liability Company will get its own statistical no. (REGON)

Contact our lawyers specialized in Limited Liability Company incorporation

Please address your enquiries to: info@dudkowiak.com, we will do our best to answer to you e-mail within 24 hours. 


Michał Dudkowiak

Lawyer

Michał Dudkowiak

Barrister, Managing Partner

Michał Dudkowiak
Piotr Putyra

Lawyer

Piotr Putyra

Barrister, Managing Partner

Piotr Putyra