A closer look at company types in Poland
By Simon O' Connor, 24th November 2016
Poland’s location offers numerous advantages for business. The country is located in the centre of Europe and because of this has access to 250 million consumers within a 1000km radius.
Company formation in Poland is very popular amongst business investors due to the large accessible market and the small costs. Poland also offers a wide range of incentives for foreign investors such as grants ranging from 25% to 50%.
The four most common types of business entities that foreign investor’s desire are:
· Limited Liability Company ( Sp Z.o.o )
· Joint Stock Company (S.A)
· Sole Proprietor
Limited Liability Company (Sp Z.o.o)
The Polish “Sp Z.o.o” is the most popular legal entity amongst small and medium sized firms. The minimum share capital for this business type is €1200 (5000 zlotys) which must be paid when incorporating. A Sp Z.o.o has a flexible structure and is relatively easy to incorporate. The company must have a minimum of one director and there are no restrictions on foreign shareholders. Annual accounts must be prepared and sent to the company office.
Joint Stock Company (S.A)
A Joint Stock Company “S.A” is usually the first choice for larger companies who require raising public capital. The minimum share capital for this business type is €25,000 (100,000 Zlotys), 25% of which must be paid when incorporating. The company must have certain governing bodies which include a Management Board, a Supervisory Board and a General Meeting of Shareholders. The company must allocate a minimum of 8% of the annual profits to the reserve fund of the company. Annual accounts must be prepared and an independent audit is also required.
There are four main partnerships used in Poland:
· Limited Partnership
A Limited Partnership must be established and conducted by a minimum of two individuals. With a limited Partnership one person must be liable to the creditors for the debts and obligations of the partnership and at least one person has a limited liability.
· Professional Partnership
A Professional Partnership is set up for the purpose of pursuing a profession in the form of a partnership. This partnership must be established by two individuals who are both qualified in the profession. No individual is liable for debts and obligations in this partnership.
· Registered Partnership
A Registered Partnership is usually for individuals looking to operate a business on a larger scale. There must be at least two individuals involved, both of which are liable without limitations to the debts and obligations of the business.
· Limited Joint Stock Partnership
A Limited Joint Stock Partnership is for conducting business on a larger scale. The business must be established by a minimum of two individuals. At least one partner is liable to the creditors for the debts and obligations of the partnership without limitation (the general partner) and at least one shareholder is not liable for debts and obligations of a partnership. However, if a business name of a limited joint- stock partnership includes name or a business name of a shareholder, this shareholder is liable for obligations of a partnership without any limitation.
A Sole Proprietor is the most straightforward and least regulated form of business entity in Poland and is extremely popular amongst small business enterprises. The individual is liable for their debts and obligations with their own property. All profits are subject to Polish income tax at individual rates.
EuroCompanyFormations.com can assist you with opening a company in Poland in the quickest possible timeframe. If you would like more information on incorporating any business entity in Poland, please do not hesitate to call us on +3531 646 1627 (Irish Office) or +49 3088789328 (German Office) or alternatively you can fill out a contact form on our website and a company formation expert will be in touch shortly.