Your Polish Company

Poland has quietly emerged as Europe's economic success story. According to IMF data, Poland now ranks as the world's 20th largest economy by GDP - a remarkable achievement for a nation that underwent post-communist transformation just three decades ago. This economic dynamism has made Poland an increasingly attractive destination for foreign entrepreneurs, offering not just access to European markets but also a skilled workforce and competitive operating costs.

I have been watching Poland change - not from the sidelines, but from within - since the early 1990s. First came the opening to the world. Then came the moment when Poland itself began to explore that world - through trade, investment, mobility, and bold entrepreneurial energy. Joining the European Union gave that process an additional push, opening new doors and adding momentum. Seeing that shift from both directions has been a privilege. And I say this without hesitation: Poland is a truly rewarding place to live, work, and build a business.

While the regulatory landscape may seem complex at first glance, Polish law is actually quite accommodating to international business owners, once you understand the framework. The country's consistent economic growth, even during global downturns, reflects the underlying strength of its business environment and the opportunities it presents for savvy entrepreneurs.

To help you navigate this opportunity, we've compiled answers to the most frequently asked questions about establishing a company or any kind of business in Poland.

Can foreigners start businesses in Poland?

Yes, foreigners can absolutely start businesses in Poland. However, the scope of available business forms depends on your citizenship and residence status. Polish law provides considerable freedom for EU/EEA citizens and certain other nationalities through international agreements, while non-EU citizens face some restrictions but still have viable options.

Who has freedom in choosing business forms in Poland?

Certain groups enjoy complete entrepreneurial freedom in Poland, able to establish any type of business entity on equal terms with Polish citizens:

EU and EEA citizens benefit from European Union treaties guaranteeing freedom of establishment. This extends to citizens of Iceland, Liechtenstein, and Norway through the European Economic Area agreement.

Americans and Swiss nationals enjoy similar privileges under bilateral trade agreements. These treaties, negotiated decades ago, remain among the most generous toward foreign entrepreneurs.

Ukrainian citizens officially residing in Poland and with a PESEL number can establish businesses under the same conditions as Polish nationals - a provision that has proven invaluable for the hundreds of thousands of Ukrainian refugees who have made Poland their temporary or permanent home.

Residents with qualifying permits form the final category. This includes holders of permanent residence permits, EU long-term resident status, temporary residence for work or study, refugee status, the "Pole's Card," and spouses of Polish citizens, among others. The list is extensive, reflecting Poland's generally welcoming stance toward legal immigrants.

If you belong to any of these groups, you can establish any form of business activity in Poland - sole proprietorship, partnership, or corporation, including branches of foreign companies. No special permits are required beyond industry-specific licensing that applies to all entrepreneurs.

What business forms are available to other foreigners?

Foreigners who don't meet the above criteria can still conduct business in Poland, but cannot establish sole proprietorships, general partnerships, or professional partnerships. Instead, they must choose from other structures:

Limited liability companies (spółka z ograniczoną odpowiedzialnością) represent the most popular choice. With a minimum capital requirement of just 5,000 PLN (approximately $1,381), these entities offer liability protection and operational flexibility. Crucially, they can be 100% foreign-owned and don't require the founder to reside in Poland.

And while the LLC is a go-to for many, it’s also worth taking a look at Poland’s simple joint-stock company (Prosta Spółka Akcyjna, P.S.A.). Designed with startups and innovative ventures in mind, P.S.A. offers flexibility in capital contributions, simplified governance, and minimal capital requirements (1 PLN) - making it a modern alternative to the classic limited liability company.

Other corporate forms include limited partnerships, joint-stock limited partnerships, and traditional joint-stock companies. Each serves different business needs and capital requirements.

Foreign branches allow entrepreneurs to register Polish operations of existing foreign companies, subject to international treaty provisions.

Foreigners may also explore opportunities to become shareholders in Polish companies by investing in or joining existing corporate entities.

Can foreigners independently establish limited liability companies in Poland?

Yes, any foreigner - regardless of citizenship or place of residence - can establish a limited liability company in Poland. As it was mentioned, these companies can be 100% owned by people from abroad, and establishing one doesn't require permanent residence in Poland.

You can own and manage a Polish company without ever setting foot in the country. That said, we always encourage our clients to consider spending time here on the ground. It can make a real difference and helps to better understand local business environment.

Poland has modernized the incorporation process through the S24 online portal, available to foreigners with qualified electronic signatures or polish trusted profiles. However, the system operates entirely in Polish and involves considerable bureaucracy. Most foreign entrepreneurs find professional assistance invaluable during formation.

How is business income taxed in different legal forms — and what about the health contribution?

If you're setting up a sole proprietorship (JDG), you'll pay personal income tax on your business profits. During registration, you pick one of three tax options: progressive rates (12% up to PLN 120,000, then 32%), a flat 19%, or lump-sum taxation with fixed rates by industry.

But here's what many don't expect: you'll also pay health insurance contributions that are no longer tax-deductible since recent reforms. This adds 4.9% to 9% of your monthly profit depending on your tax choice — a cost that can really add up for small businesses.

Partnerships work differently depending on the type.

In general partnerships (sp.j.) and professional partnerships (sp.p.), each partner pays personal income tax on their share of profits and handles their own health contributions, similar to sole proprietors.

Limited partnerships (sp.k.) and limited joint-stock partnerships (S.K.A.) face double taxation. The company pays 19% corporate tax first (or 9% for smaller companies under €2 million revenue), then partners pay another 19% personal tax when profits are distributed. All partners typically pay monthly health contributions too, regardless of whether they draw a salary.

Worth noting: general partnerships can also fall under corporate tax if any partner isn't a natural person.

For capital companies like limited liability companies (sp. z o.o.), joint-stock companies (S.A.), or simple joint-stock companies (P.S.A.), it's always corporate tax at 19% (or 9% for small taxpayers). When profits are distributed as dividends, shareholders pay another 19% withholding tax.

The company itself doesn't pay health contributions, but individual shareholders might still be liable — especially if you own 100% of a single-member company or work for equity in a P.S.A. In these cases, you're treated like a self-employed person and must pay monthly health contributions even without a salary.

When do you have to register for VAT?

Value-added tax isn't mandatory for all businesses. Companies with annual sales below 200,000 PLN can claim small business exemption, eliminating VAT charging and filing obligations. This threshold increases to 240,000 PLN starting January 1, 2026.

However, certain activities require VAT registration regardless of sales volume: precious metals trading, fuel sales, legal services, and consulting. Exceeding the exemption threshold requires registration within seven days.

Are there banking obligations you can’t ignore?

Polish law requires cashless transactions for inter-company payments exceeding 15,000 PLN. Companies using cash for such payments lose tax deductibility. Additionally, active VAT taxpayers must report bank account numbers to the official "white list"—payments to unlisted accounts above 15,000 PLN result in non-deductible expenses and joint liability for unpaid VAT.

In practice, a Polish corporate bank account is virtually mandatory for serious business operations.

Does business ownership provide residence or work rights?

No, establishing a business in Poland doesn't automatically grant residence or work rights. Even 100% company ownership requires separate immigration procedures.

EU/EEA and Swiss citizens enjoy freedom of movement under European treaties and can live and work in Poland with minimal formalities—registration is required only for stays exceeding three months.

Third-country nationals must obtain appropriate visas or residence permits. Business ownership may support applications for temporary residence permits for conducting business activity or corporate management roles, but these require separate applications with specific qualification criteria.

Many foreign entrepreneurs successfully operate Polish businesses while residing abroad, managing operations remotely and visiting for business purposes under tourist arrangements.

Summary: The Path Forward

Poland may no longer be the quiet success story - it’s now firmly on the map. What was once a country rebuilding itself has become a place where others come to build. We’ve had the chance to watch that shift from the inside, and it continues to give us a sense of purpose and perspective.

If you're thinking of joining that story, you won't be alone - and you won’t be the first. The opportunity is real, the conditions are workable, and the satisfaction of building something here is hard to overstate. The rest is business as usual.

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This article provides general information about doing business in Poland. Always consult with qualified legal and tax professionals for advice specific to your situation.