Doing Business in Poland: A Practical Guide for Foreign SMEs

Doing business in Poland gives a foreign SME access to a large EU market, a skilled workforce and investment incentives. Most foreign companies start with a Polish limited liability company, which can be fully foreign-owned. They then face a set of local rules that are worth knowing from day one: 19% or 9% corporate income tax, 23% VAT, full accounting books, mandatory e-invoicing in KSeF and monthly payroll filings. This guide summarises each area and points to detailed articles.

Why do foreign companies choose Poland for doing business?

Foreign companies choose Poland for its market size, its labour pool and its role as a manufacturing and services hub in the European Union. Poland is an EU member state, so a Polish company trades within the EU single market.

The Made in Poland report, an investment guide for manufacturing prepared by JLL in collaboration with the Polish Investment and Trade Agency (PAIH), Hays and ALTO, gives some figures:

• In 2023, the Polish Investment and Trade Agency supported investment projects with a record value of EUR 7.4 billion.
• In 2023, manufacturing businesses employed over 2.8 million people in Poland.
• Poland’s average unemployment rate in 2023 was 5.1%.
• Among foreign investors, the United States led in 2023, followed by Germany and the United Kingdom.

For an SME, these numbers mean two things. First, there is an established ecosystem of suppliers, landlords, banks and advisors used to working with foreign owners. Second, competition for skilled employees is real, so payroll and employment terms need attention from the start.

Which business structure fits a foreign company?

Most foreign SMEs set up a Polish limited liability company (sp. z o.o.), which can be 100% foreign-owned and requires share capital of at least PLN 5,000. A branch office is an alternative when the parent wants to operate in Poland without a separate legal entity.

A limited liability company can be registered online in the National Court Register (KRS). Via the S24 system, the court should process a paid application within one day. The full process, including tax numbers, VAT registration and a bank account, usually takes several weeks. Our step-by-step guide explains how to set up a company in Poland. For the fastest start, ALTO offers a ready-made company and a registered office in Warsaw as part of its Go-to-Poland package.

Which taxes apply to companies in Poland?

A Polish company pays corporate income tax (CIT) at 19%, or 9% if it is a small taxpayer or in its first tax year, and charges VAT at a standard rate of 23%. Payments to foreign entities, such as dividends, interest and royalties, may be subject to withholding tax.

Withholding tax is the area where foreign groups most often meet unexpected costs. When certain payments, such as dividends, interest or royalties, to the same recipient exceed PLN 2 million a year, the pay and refund mechanism can apply: the tax is collected first and refunded later, unless the company uses one of the statutory procedures. ALTO helps groups apply the exemption from WHT and manage company taxes in Poland.

Tax rulings. When the tax treatment of a planned transaction is unclear, a company can apply for an individual tax ruling (interpretacja indywidualna) from the National Tax Information (KIS). If the company receives a ruling before the transaction and follows it, it does not owe additional tax, interest or fiscal penal liability, even if the authorities later take a different view. The fee is PLN 40 for each described situation.

What accounting and reporting rules apply?

Every Polish company keeps full accounting books in Polish and in złoty, files monthly tax returns electronically and files annual financial statements with the KRS. There is no revenue threshold below which a company can use simplified records.

The main points for a foreign CFO:

• Language and currency: books and financial statements in Polish and in złoty; reporting to the parent can be in English.
• IFRS: a company in a group that reports under IFRS may, under conditions set in the Accounting Act, adopt IFRS for its statutory statements by decision of its approving body.
• Annual cycle: financial statements within 3 months of the year end, approval within 6 months, filing with the KRS within 15 days of approval.
• Audit: required when the company exceeds two of three thresholds: 50 full-time employees, EUR 3,125,000 in total assets and EUR 6,250,000 in net revenue.
• JPK (SAF-T): monthly VAT files and, for CIT taxpayers, the annual JPK_CIT file, covering all CIT taxpayers for tax years starting in 2027.
• KSeF: since 2026, invoices are issued and received through the National e-Invoice System; penalties can apply from 2027.

Our guide to accounting in Poland covers each of these duties in more detail. Most foreign SMEs outsource accounting to a provider that reports to the parent in English. See ALTO’s accounting services.

How to hire employees in Poland?

To hire employees in Poland, a company signs written employment contracts, registers each employee with ZUS within 7 days and runs a monthly payroll cycle. The employer pays social security contributions of roughly 20% on top of gross salaries.

The key facts:

• Minimum wage in 2026: PLN 4,806 gross a month.
• Salary payment: at least once a month, no later than the 10th of the following month.
• ZUS contributions: by the 15th of the following month for companies.
• Income tax withheld from salaries: by the 20th of the following month; personal income tax rates of 12% and 32%.
• PPK: a workplace pension scheme with a basic contribution of 1.5% from the employer and 2% from the employee.
• B2B contracts: since 8 July 2026, a labour inspector can issue a decision finding that a civil law contract is in fact employment, if the employer does not follow the inspector’s order.

A foreign company can also use an employer of record or employ people directly as a foreign contribution payer. Our guide to payroll in Poland compares these options. ALTO runs HR and payroll for foreign-owned companies.

Which incentives and tax reliefs are available?

Poland offers income tax exemptions for new investments in the Polish Investment Zone and several tax reliefs for innovation, including the R&D relief and the IP Box. These can significantly reduce the effective tax rate of a foreign-owned company.

Reliefs require documentation, and their use can be verified by the tax authorities. Plan them from the start of the project, not after the year ends. See ALTO’s R&D relief and tax reliefs services.

What does it cost to run a company in Poland?

The running costs of a Polish company consist of one-off setup costs and recurring monthly costs, of which accounting, payroll, office and salaries are the largest. Official registration fees are low; professional services make up most of the setup budget.

Ask providers for a monthly fee based on your expected volumes, not an hourly rate. This makes the budget predictable in the first year, when volumes are hard to estimate.

How to choose a local advisor for doing business in Poland?

Choose an advisor who covers company formation, accounting, tax and payroll in one place, reports in English and knows the latest Polish requirements, such as KSeF and JPK_CIT. One provider for all areas means fewer handovers and one view of your Polish company.

Questions worth asking:

1. Can you set up the company, keep the books and run payroll, or will we need several providers?
2. Who will be our contact person, and do they speak English?
3. How do you report to the parent company, in what format and by which day of the month?
4. How do you handle KSeF and JPK_CIT for clients using a group ERP system?
5. Can you represent us before tax authorities and in tax audits?
6. Do you offer a registered office and corporate secretarial services?
7. How do you price your services, and what happens when volumes grow?

Check also whether the advisor works with companies of your size. An SME needs fast answers and practical support, not a large-scale project team.

FAQ

Can a foreigner start a business in Poland? Yes. A foreign company or a foreign individual can set up a Polish limited liability company and hold 100% of its shares. Citizens of the EU, the EEA and Switzerland can also use other legal forms on the same terms as Poles. Additional permits may be needed in specific cases, for example when the company owns real estate.

Is Poland a good place for foreign SMEs? Poland offers access to the EU market, a large labour pool and investment incentives. According to the Made in Poland report, the Polish Investment and Trade Agency supported investment projects worth a record EUR 7.4 billion in 2023. The trade-off is a demanding compliance environment, with frequent changes such as KSeF and JPK_CIT.

What is the corporate tax rate in Poland? The standard CIT rate is 19%. Small taxpayers, with prior-year sales up to the PLN equivalent of EUR 2 million, and companies in their first tax year can pay 9%, subject to exclusions. Advance payments are due monthly by the 20th, and the annual CIT-8 return by the end of the third month after the tax year.

Do I need a Polish address to run a company? Yes. A Polish company must have a registered office and an address in Poland, entered in the KRS. Many foreign SMEs use a registered office service at the start. What matters is reliable handling of mail, because tax offices, ZUS and courts send official letters to this address.

Can I run a Polish company from abroad? Yes. Board members do not have to be Polish citizens or residents, and most filings are electronic. In practice, you need a qualified electronic signature or a Polish proxy for many filings, a local accounting provider and a registered office in Poland. Board members remain responsible for the company’s compliance.

How long does it take to start operating in Poland? KRS registration via S24 can take one day, but a realistic timeline for a new company is several weeks, mainly because of documents, translations and bank onboarding. A ready-made company allows a foreign investor to start operating much faster.

How ALTO supports

ALTO supports foreign companies through their whole journey in Poland, from market entry to day-to-day compliance. Our Go-to-Poland package combines a ready-made company, a registered office in Warsaw, accounting, tax compliance, payroll and banking support. Our tax, legal and payroll experts work as one team and report in English. For businesses relocating from Ukraine, we also offer a dedicated guide for Ukrainian businesses.

Sources

• JLL in collaboration with PAIH, Hays and ALTO, Made in Poland: An Investment Guide for Manufacturing (May 2024): https://madeinpoland.report/wp-content/uploads/2024/06/fbe4c24a-4d2f-4636-bf81-5481e979da5f.pdf
• Business.gov.pl, Setting up a company in Poland by a foreigner: https://biznes.gov.pl/en/portal/004055
• Biznes.gov.pl, Zarejestruj spółkę w systemie S24: https://www.biznes.gov.pl/pl/portal/00167
• Biznes.gov.pl, CIT for companies: https://www.biznes.gov.pl/pl/portal/00251
• Gov.pl, how to obtain an individual tax ruling: https://www.gov.pl/web/gov/uzyskaj-podatkowa-interpretacje-indywidualna
• Podatki.gov.pl, CIT rates and limits: https://www.podatki.gov.pl/podatki-firmowe/cit/cit-klasyczny/stawki-i-limity
• Podatki.gov.pl, VAT basic information: https://podatki.gov.pl/podatki-firmowe/vat/informacje-podstawowe
• Podatki.gov.pl, e-financial statements: questions and answers: https://www.podatki.gov.pl/e-sprawozdania-finansowe/pytania-i-odpowiedzi/
• National Revenue Administration, JPK structures in income taxes: https://www.gov.pl/web/kas/struktury-jpk-w-podatkach-dochodowych
• Tax Administration Chamber in Katowice, second stage of KSeF implementation: https://www.gov.pl/web/ias-katowice/drugi-etap-wdrozenia-krajowego-systemu-e-faktur
• Ministry of Family, Labour and Social Policy, minimum wage: https://www.gov.pl/web/rodzina/minimalne-wynagrodzenie-za-prace
• Biznes.gov.pl, ZUS contribution deadlines: https://www.biznes.gov.pl/pl/portal/00277
• Mojeppk.pl, PPK contributions: https://www.mojeppk.pl/aktualnosci/jak-utworzyc-ppk-przekazuj-wplaty-do-ppk-1023n.html
• Ministry of Family, Labour and Social Policy, PIP reform enters into force: https://www.gov.pl/web/rodzina/wzmacniamy-panstwowa-inspekcje-pracy–reforma-wejdzie-w-zycie