OpusGuide: Poland
– Limited liability
company

Limited liability company (spółka z ograniczoną odpowiedzialnością) in Polish law is one of the basic legal forms of companies in our country. It is made of one or several entities which are not held responsible for company’s liabilities. It is the z o.o. company which is responsible on its assets. In Poland there are almost 300 000 z o.o. companies.

 

 

 

LEGAL FORM	Limited liability company – one of two capital companies existing in Polish law, established on the notary deed and registered in Krajowy Rejestr Sądowy (National Court Register).
ENGLISH TRANSLATION	Limited / Limited Liability Company.
BUSINESS ACTIVITY	Any that is legally accepted; necessity to obtain permissions or license is exceptional and applies only to given kinds of activities.

AUTHORITIES AND OTHER IMPORTANT POSITIONS/FUNCTIONS	owners	Shareholders’ meeting – consists of shareholders – legal or natural persons (possibility to fund a single-member company). Shareholders have control and supervisory competences.
	management	Board – mandatory body in a company which has the authority to administer company’s affairs and represent it outside. It is appointed by shareholders’ meeting – can consist of one person or many people. The scope of competences stems from the Kodeks Spółek Handlowych (Commercial Companies Code), however it can be modified or specified by company’s agreement. Only natural persons can take positions in the company’s board.
	supervision	Rada Nadzorcza (Supervisory Board)/Komisja Rewizyjna (Review Panel) – optional bodies which permanently supervise current company’s activity, composed of at least 3 natural persons. Appointment takes place on the basis of shareholders’ resolution. One of the above mentioned bodies has to exist only if company’s share capital is more than 500 000 PLN, and there are more than 25 shareholders.
	other	Names of people from the Board as well as Supervisory Board / Review Panel are explicit and available in the KRS register. Shareholder’s name is revealed if he or she possesses over 10% of shares (or is the only shareholder). Up-to-date company agreement as well as a list of shareholders shall be included in registration files. Registration Files are explicit.

APPLICATON OF FIDUCIARY	nominal shareholder	Not present in Polish law, fiduciary secrecy not recognized by courts.
	trust	Not regulated by Polish law, fiduciary secrecy not recognized by courts, but acceptable on the basis of agreement freedom.
MINIMAL SHARE CAPITAL		Minimal share capital equals to 5.000 PLN and is divided into equal or unequal shares of at least 50 PLN. It is necessary to fully cover the share capital (financial or non-financial contribution).
ACCOUNTING/AUDIT		Limited liability company keeps accounts, audit is required in circumstances specified by the law.
REGISTERED OFFICE		Company shall have its registered office on the territory of Poland.
TIME LIMITS	foundation	Company is founded when the agreement is signed in the form of notary deed. From this moment, it can act as z o.o. ‘in construction’. Once it has been registered in KRS, the company acquires legal personality. The registration process takes 2-4 weeks.
	liquidation	Liquidation of a company requires shareholders’ resolution. Company appoints a liquidator who keeps company’s affairs instead of the Board. During the process of liquidation, the company shall satisfy all creditors and liquidate company’s assets. Liquidation requires opening and closing balance. Company’s liquidation is valid once it has been ruled out from KRS.
	strike-off	Not present in Polish law.
BANK ACCOUNT		Any bank in Poland and other UE, EOG and OECD countries.
CURRENCY		Polish Złoty.
OFFICIAL LANGUAGE		Polish.
FINANCIAL YEAR		Financial year is generally calendar year, unless otherwise concluded in company’s agreement, however it always has to be 12 consecutive months. An exception is a company that starts its activity in the middle of calendar year which can cover in one financial statements the year of starting its activity and the following full calendar year.

TAX RESIDENCY	Residents: Company has Polish residency if its registered office or the Board is located on the territory of Poland.
INCOME TAX (CIT)	VAT rate: 19% Residents – are subject to unrestricted tax liability Non-residents – are subject to limited tax liability from income received from Polish sources. Dividends and capital gains are subject to 19% VAT. Dividends obtained by a Polish company from residents being capital companies from UE/EOG with proper capital connection are free from taxation.
SPECIAL FISCAL SYSTEM	z o.o. companies and joint stock companies which are Polish tax residents can fund a tax capital group. This group is a tax payer. The basis for taxation is income from all companies of the group, so the income of a prosperous company will be lowered by losses of other companies. In reality, the tax capital group does not exist.
WITHHOLDING TAX (WHT)	Dividends: 19%, Royalty payments: 20% Interest: 20% The above rates may be lowered to the level specified in the act on avoiding double taxation or EU regulations.
RULES ON COMBATTING VAT EVASION	Transfer prices: YES Thin capitalization: YES CFC: Planned date of entry into force January 2015 Attention! There is a blacklist of countries which use harmful tax competition.

* Data current as of April 28, 2014