Are you an entrepreneur considering opening a branch of your company in Poland? Then you need to familiarize yourself with the most important steps and legal requirements that are associated with this process. In order to legally conduct business in Poland, it is necessary to fulfill a number of formalities. In this article, we will present you step by step how to register a branch of your company in Poland, discuss the differences between a branch and a representative office, and indicate what documents and procedures are necessary to start a business.
Branch vs representative office – what are the differences?
It is important to clarify the differences between a branch and a representative office of a foreign company in Poland, because these concepts are often considered to be the same. You must know they enable completely different activities. In the case of establishing a branch, the entrepreneur conducts the same business activity as in his/her home country. This means that the Polish branch conducts exactly the same activities as the company’s headquarters located abroad. However, within the framework of a representative office, it is only possible to conduct activities that do not go beyond advertising and promoting the foreign company. The representative office cannot take the same steps as the parent company.
What do you need to know before establishing a branch in Poland?
Before establishing a branch of a foreign company in Poland, it is important to understand several key aspects of the legal and procedural requirements. These include the necessary documentation, registration processes, and compliance with Polish business regulations. Whether you are setting up a branch for expansion or simply looking to establish a presence in the Polish market, there are specific steps to follow to ensure everything is in order.
Branch registration in Poland – step by step
Registering a foreign company branch in Poland is a process that requires meeting specific formalities. See what the next stages of this process look like.
1. Resolution on the establishment of a branch
To set up a branch in Poland, you must meet many formal requirements. To make this possible, you need to verify whether the company’s articles of association provide for foreign headquarters. If so, you need to prepare an appropriate resolution that will include information such as the name of the branch and its headquarters, and subject of the business. The document must also indicate the person authorized to represent the company. In some countries, additional registration in the country where the company is headquartered is required, both before and after completing the registration of the branch in Poland (e.g. in the UK).
2. Founding documents and translations
The founding documents of the company will have to be translated by a Polish sworn translator. These are: company agreements, by laws or other similar documents (with any modifications and amendments). Such documents will have to be apostille-stamped or legalized. Apostille is a certification of the official nature of a national document, needed if it is to be used abroad. It confirms the signature and the capacity in which the person who signed the document acted and the identity of the seal on the document.
3. Registration in the National Court Register (KRS)
The application for registration of a branch in the National Court Register is completed electronically and is usually processed within 2 weeks to 2 months. After the entry is made, it will be placed in the publicly accessible register of entrepreneurs.
MUST KNOW!
The application for entry can only be submitted electronically via the Court Register Portal – PRS (https://prs.ms.gov.pl/).
The following documents must be attached to the application:
- the articles of association, agreement or statute of the parent company together with a certified translation into Polish;
- an extract from the register together with a certified translation into Polish;
- the address in Poland of the person authorized to represent the foreign entrepreneur in the branch;
- certificate of the Polish representative office of a foreign entrepreneur regarding the reciprocity of the action;
- resolution of the parent company’s management board on the establishment of a branch and the appointment of a person representing the foreign entrepreneur in the branch;
- other documents, such as a power of attorney and proof of payment of the stamp duty for the power of attorney.
Remember: the branch cannot conduct any business in Poland until the registration process is completed!
4. Starting a business
After branch registration in Poland the first steps before starting a business include:
- establishing cooperation with a local accountant
- establishing cooperation with a payroll service provider
- registering as an employer with ZUS
- opening a bank account
- reporting the branch registration to the Tax Office
- registering for VAT
A foreign entrepreneur establishing a branch office is required to appoint a person authorized to represent the parent company in Poland in the branch office – a proxy, also known as a branch representative. Since the branch office does not have formal separate management bodies, all matters are handled by a person indicated by the foreign entrepreneur.
Polish law does not specify any requirements for selecting a representative – it does not have to be a Polish citizen or an employee of the branch office, or a person who speaks Polish. However, the proxy must have an address in the territory of the Republic of Poland.
The most important information for entrepreneurs
| Does the branch have legal personality? | No – the branch does not have legal personality |
| Who can open a branch in Poland? | Entrepreneurs from the EU and other countries (under additional conditions) |
| Accounting | Yes – the branch must keep accounting records in accordance with Polish regulations. |
| Reporting | Yes – the branch must prepare annual financial statements in accordance with Polish regulations. |
| Taxes | Yes – the branch is subject to taxation in Poland |
| Bank account | The branch is not required to have a bank account in Poland, but it is recommended |
| Registration numbers | Each branch has: KRS number REGON number If necessary, the branch may apply for a NIP number if it employs employees in Poland |
Tax issues – what you need to know!
According to Polish tax regulations, a foreign company branch in Poland is subject to limited tax liability under corporate income tax. This means that the branch is subject to corporate income tax only on income earned in the territory of the Republic of Poland. A branch of a foreign company in Poland is subject to registration as a VAT payer in Poland.
- Corporate income tax
From the point of view of CIT – the branch is treated as a special purpose vehicle – Permanent Establishment – and will be subject to taxation in Poland on revenues generated locally. The Polish branch should take into account two basic CIT rates 9% for small taxpayers (turnover not exceeding EUR 2 million) and 19% for other taxpayers.
- VAT
The branch will also become a Polish VAT payer if it sells goods or provides services (locally or internationally). After starting such activity, such a branch should register as a VAT payer in Poland. The basic VAT rates for 2024 are 23% (as the default and most common rate), 0%, 5% and 8% for selected products and services.
Despite the differences, creating a branch of a foreign company in Poland is neither more difficult nor easier than in other European countries. However, opening a new entity requires knowledge of the specifics of the market and in-depth knowledge of the tax system. In case of doubt, it is worth consulting a law and tax office. Specialists will help you avoid mistakes that may lead to penalties or other unpleasant consequences.
Specialized legal support is the basis for the success of your business!
As we have already explained, establishing a branch requires collecting documentation and completing a number of formalities that can be complicated, especially if you do not speak Polish or have no experience with Polish offices. Thanks to the experience of specialists, the business setup process can be faster and more efficient, which allows you to save time and resources that could be spent on business development.
