Establishing a Limited Liability Company in Poland (sp. z o.o.) – Key Information and Step-by-Step Process

Key Features of a Limited Liability Company (sp. z o.o.)

A limited liability company (sp. z o.o.) is a popular form of business entity in Poland, characterized by legal personality and limited liability for shareholders. Here are the essential features and operating principles of a sp. z o.o.

Features and Advantages

A sp. z o.o. can be established by one or more shareholders for any legally permissible purpose, except by another single-member sp. z o.o. Both individuals and legal entities can be founders, regardless of citizenship or place of residence.

This legal form is particularly attractive for those who wish to maintain direct oversight of the company’s activities while limiting financial risk to their contributed capital.

Share Capital

The minimum share capital of a sp. z o.o. is 5000 PLN. Contributions can be monetary or non-monetary, and each shareholder contributes proportionally to their shares.

Formation and Registration Process

The formation of a sp. z o.o. involves signing an agreement in the form of a notarial deed or using a template agreement via the S24 system. The process includes several steps:

Signing the company agreement.

Making contributions by shareholders.

Appointing the management board and, if required, establishing a supervisory board or audit committee.

Registering the company in the National Court Register (KRS).

Since July 1, 2021, registration is exclusively electronic via the Court Registers Portal or the S24 Portal. After registration, the company must submit additional data to the tax office, Social Insurance Institution (ZUS), and Central Statistical Office (GUS) within 7 and 21 days.

Company Name

The name of a sp. z o.o. must include the designation “spółka z ograniczoną odpowiedzialnością” or the abbreviation “sp. z o.o.”. Additional elements indicating the business activity, company seat, or other terms can be included as long as they are not misleading.

Company Organs

A sp. z o.o. has three main bodies:

Shareholders’ Meeting: the highest authority in the company.

Management Board: the executive body representing the company.

Supervisory Board or Audit Committee: supervisory bodies (mandatory when the share capital exceeds 500,000 PLN and the company has more than 25 shareholders).

Shareholders’ Liability

Shareholders of a sp. z o.o. are liable for the company’s obligations only up to the amount of their contributions. In case of insolvency, management board members may be jointly liable if they fail to file for bankruptcy in due time or if the creditor suffers damage.

Profit Distribution

The profits of a sp. z o.o. are distributed proportionally to the shareholders’ shares, unless otherwise stipulated in the agreement. The shareholders’ meeting decides on profit distribution.

Taxes and Accounting

A sp. z o.o. is subject to CIT and VAT and must maintain full accounting records. Shareholders pay income tax on distributed dividends.

If you need to establish a company, contact us:

Phone: +48 22 290 11 22

Email: biuro@mencel.com.pl

Our company is authorized to establish companies as this is a regulated activity. We provide services in the field of activities for companies or trusts, in accordance with the provisions of the Act of March 6, 2018 – Entrepreneurs’ Law. Our experts are ready to assist you at every step of the process of establishing a limited liability company.

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