Table Of ContentInvestment
in Poland
kpmg.pl
KPMG IN POLAND
2 | Investment in Poland
Chapter 1
Contents
Chapter 1 - Poland - a Brief Summary 4 4.2 F inancial Statements and Audit
1.1 Geography and Climate 4 Requirements 67
1.2 History 4 4.3 Leasing Regulations 71
1.3 Government and Constitution 6 4.4 Exchange Control Regulations 72
1.4 Currency 8 4.5 Intellectual and Industrial Property 74
1.5 Population and Language 8 4.6 Anti-Monopoly Law 76
1.6 Labour market 9 4.7 Labour Law 79
1.7 Economy 10 4.8 Real Estate 86
1.8 Main Cities 13
1.9 C oming to and Living in Poland
Chapter 5 - Business
– Practical Tips 27
and Personal Taxation 90
5.1 Taxes in Poland 90
Chapter 2 - Business Opportunities 38 5.2 General Rules of Taxation 90
2.1 Incentives for Foreign Investment 38 5.3 Taxation System 90
2.2 G rants from EU Structural Funds 39 5.4 VAT 91
2.3 N ational Sources 41 5.5 Customs Issues 97
2.4 T ax Incentives in Special 5.6 Excise Tax 101
Economic Zones 42 5.7 Corporate Income Tax 103
2.5 Other Incentives 44 5.8 C orporate Income Tax
2.6 Privatisation 46 (3epresentative offces) 10
5.9 Personal Income Tax 109
.10 Social SecVrity (;6S) 112
Chapter 3 - Forms of Carrying 5.11 S ocial Security 114
out Business Activity.
5.12 Local Taxes and Charges 115
Available to Foreign
5.13 S tamp Fees and Tax
Entities in Poland 50
on Civil Transactions 115
3.1 Legal Status 50
3.2 Establishing a Company 51 Appendix A - C oncessions and Permits for
Conducting Economic Activity in
3.3 Capital 53
Poland
3.4 Participation in Existing Companies 55
3.5 The Management Board 55 Appendix B - B asic Differences between
Limited Liability Company
3.6 Supervisory Bodies 55
(Sp. z o.o.) and +oint Stock
3.7 The General Assembly 56
Company (SA)
3.8 Dissolution and Liquidation 58
Appendix C - P rocedures for Establishing
3. #ranches and 3epresentative 0ffces
aŨCompany
Appendix D - C ontents of Financial Statements
Chapter 4 - Business Environment 62
Appendix E - S elected Data from Double
4.1 A ccounting, Financial Statements
Taxation Treaties between Poland
and Auditing Requirements 62
and Other Countries, Relating to
Withholding Tax
© 2013 KPMG Sp. z o.o. a Polish limited liability company and a member frm of the KPMG network of independent member frms
affliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
Investment in Poland | 3
© 2013 KPMG Sp. z o.o. a Polish limited liability company and a member frm of the KPMG
network of independent member frms affliated with KPMG International Cooperative (“KPMG
International”), a Swiss entity. All rights reserved.
4 | Investment in Poland
Chapter 1
Poland – a Brief Summary
1.1 Geography and Climate Poland’s climate is prone to abrupt
changes both during the seasons and
Poland is situated in the heart of Central
from year to year. Average temperatures
Europe and is the ninth-largest country
are between and 0őC in +anVary to
on the continent, with an area of 312,679
120őC in +Vly, with minimVm and
square kilometres and a population of
maximum temperatures ranging from -20
38.5 million.
to 35°C. Poland is in the Central European
The country borders Russia, Lithuania,
time zone and is thus one hour ahead of
Belarus and Ukraine in the north and
standard GMT. The country switches to
east, the Slovak and Czech Republics
daylight saving time between the end of
in the south and Germany in the west.
March and the end of October.
Its borders extend for almost 3,600
kilometres, including 530 kilometres on
the Baltic coast. The capital, Warsaw 1.2 History
together with its immediate suburbs,
In early times, Poland was inhabited by
has a population of 2.6 million. Poland’s
Western Slavs, who adopted Christianity
largest cities besides Warsaw are Cracow
in 966 A.D. The Polish Kingdom was
– which is Poland’s historical capital and
established in 1025 A.D. and encompassed
its second largest metropolis, òdĖ,
approximately 80% of today’s Polish
8rocìaw, Poznaí and Gdaísk.
territory. After the reign of the Piasts,
Poland consists mainly of lowland areas, Poland’s ancient ruling family, Poland
with 75% of the land less than 200 was divided into a large number of
metres above sea level. The countryside smaller kingdoms (113130). After the
is nevertheless varied: there are beautiful consolidation of the country during the
lake regions (9,300 in excess of one +agiellonian period (1312), Poland once
hectare in size), forests and moVntains. again ĜoVrished cVltVrally and economically
Poland’s highest peak, Rysy in the Tatra its territory at the end of the period was
Mountains, rises 2,499 metres above several times larger than that of today’s
sea level. 5he 8isìa (7istVla), Polandijs Poland. During the following 200 years, the
longest river, measures 1,050 kilometres kings (inclVding a nVmber of foreign rVlers)
in length. The second longest, the Odra were elected by a congress of noblemen.
(0 kilometres), Ĝows along the border Their accumulated reigns brought about
with Germany. prosperity and the accelerated growth of the
country’s towns. Nevertheless, recurrent
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affliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
Investment in Poland | 5
wars eventually impoverished the economy of the worldwide depression. Following
and led to rural stagnation. Germany’s invasion of Poland on 1st
September 1939 – which gave rise to World
Efforts to address the rapidly deteriorating
War II – the country was divided between
situation, including the proclamation of the
Nazi Germany and the Soviet Union. The
world’s second liberal constitution (after
government was forced to Ĝee Poland, and
that of the 6S), were Vndertaken mVch
eventually resumed operations in England.
too late. Poland’s neighbours resolved to
Despite strong oppression by their invaders
consolidate their forces, and took advantage
Poles maintained a strong underground
of its military and economic weakness by
resistance throughout the war.
imposing three consecutive partitions, in
1772, 1793 and 1795. The result of these Subsequent to World War II, Poland
divisions was the total erasure of Poland once again regained its independence,
from the map of Europe. The three regions althoVgh it was signifcantly restricted by a
of partitioned Poland (under Russian, strong Soviet inĜVence over the coVntryijs
PrVssian and AVstrian control) had varying economic and political systems. In 1945, it
degrees of autonomy, but were constantly had 24 million inhabitants and covered an
subject to new restrictions, primarily area of 311,700 square kilometres. Following
directed against Polish culture and national the war, it lost signifcant territories and
identity. This gave rise to a series of protests, cities in the &ast (inclVding -vov and 7ilniVs),
which in 1830 and 1863 took the form of bVt acRVired some 8estern ones (8rocìaw
general uprisings. and Szczecin), which were historically Polish.
During this period, internal migration took
At the end of World War I, Poland regained
place on a massive scale.
both its independence and control over a
large part of its former territory. In 1919, the According to the prevailing Soviet doctrine,
country had over 26 million inhabitants and all large farms and banks, and nearly the
was approximately 25% larger than it is whole of industry, commerce, transport
today. In 1939, there were already 35 million were nationalised and centrally managed.
Poles, although a third of them had a mother In practice this brought more losses than
tongue other than Polish. gains, along with a growing discontent
among the population. Activity by the
Between the two World Wars, Poland had
democratic opposition eventually led to
ample time to consolidate its national,
several explosions of social discontent and
political and legal identity economic
the creation in 1980 of the Solidarity union
consolidation was harder to achieve because
ĸ the frst independent Vnion in Central
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affliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
6 | Investment in Poland
Chapter 1
Poland – a Brief Summary
and Eastern Europe since World War II. Monetary Fund, the World Bank, NATO, the
Determined to stay in full control, in 1981 the OECD, and the Convention for the Protection
authorities imposed martial law, which sent of Intellectual Rights, as well as other
the opposition underground and resulted in international bodies. Until 1st May 2004,
numerous economic sanctions by the West. Poland was also a member of the free-trade
zone CEFTA. EU enlargement automatically
In 1989, the Communist Party, in the wake
terminated CEFTA membership for the new
of general economic collapse and social
EU countries – Poland, Czech and Slovak
discontent, was effectively forced to step
Republics, Hungary and Slovenia.
aside in favour of the opposition following
the ”round table” negotiations. The years
following witnessed free presidential and
1.3 Government and Constitution
parliamentary elections, recovery of political
Poland is a parliamentary democracy
and individual freedoms, regained external
headed by a president elected in
political autonomy, and the introduction of a
general elections. The presidential
market economy.
term of offce is years from the date
Since the collapse of communism in 1989,
of swearing in. The president’s role,
Poland has dramatically transformed its
the election procedures, the functions
economy and has enjoyed unsurpassed
and responsibilities of the parliament
success in terms of economic growth,
and government are determined by the
fnancial stability and investment
provisions of the Constitution of the
attractiveness. This is demonstrated by EUR
Republic of Poland of 2nd April 1997.
153.3 billion of Foreign Direct Investment
The president is the commander of the
stock, as of December 2011.
armed forces and may veto legislation
Following a successful referendum on
passed by the parliament. The vetoes
European Union accession and subsequent
can be overturned by a minimum of a
approvals of the EU member countries,
threeffths vote in the SeKm (the lower
Poland joined the EU on 1st May 2004.
hoVse of parliament). 5he president is the
Along with nine other countries, Poland
country’s top-level representative in all
became a member of an economic and
international and internal relations and his
political organisation that will determine its
powers also include the right to dissolve
prospects for decades.
the parliament and call new elections if
Poland is a member of the United Nations the parliament proves unable to observe
Organisation, UNIDO, the International constitutional deadlines for adopting
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affliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
Investment in Poland | 7
such key legislation as the budget or the conjunction with the Polish People’s Party
composition of a new government. (PS-), a social conservative party ( of
seats), formed the government. 5he -aw
5he president of Poland is #ronisìaw
and +Vstice (PiS) party won 3 of seats.
Komorowski of the governing Civic
Platform (P0) party, elected on th +Vly The prime minister, nominated by the
2010. president to form a government and win a
vote of confdence in the SeKm, chairs the
Poland’s previous president was Lech
Council of Ministers and is Poland’s head
Kaczyíski, of the rightwing -aw and
of government. Poland’s incumbent prime
+Vstice party (PiS), elected in 0ctober
minister is Donald Tusk, the leader of
2005. On 10th April 2010 the president
Civic Platform (P0).
together with his wife Maria and dozens
of the country’s top political and military Poland is divided into 16 provinces
leaders lost their lives in a plane crash with signifcant selfgoverning powers.
in Smolensk. -ech Kaczyíski was Ĝying Each of the provinces (voivodeships –
to Smolensk to commemorate the 70th woKewòdztwa) is headed by a provincial
anniversary of the murder of Polish governor (voivode ĸ woKewoda) appointed
offcers by the Soviet secret police. by the central government. The provinces
The plane crash was the worst political are further divided into 379 counties
disaster in the post-war history of Poland. (powiaty) and 2, commVnes (gminy).
The local governments of the provinces,
The bicameral parliament, composed of
counties and communes are elected in
a lower hoVse (SeKm) and Vpper hoVse
general local elections the most recent
(Senat), is elected every foVr years in
elections were held in autumn 2010.
general elections and is responsible for
Local administrations are responsible
creating laws. In this respect, it is the
for managing local affairs, including the
SeKm that has most of the power the
allocation of public funds.
Senate may only suggest amendments to
legislation passed by the Sejm. Poland’s
last parliamentary elections were held
in 0ctober 2011. Civic Platform (P0),
a centre-right party based on liberal
conservative values won the elections
for the second time in a row and received
45% of the seats in the Sejm, and in
© 2013 KPMG Sp. z o.o. a Polish limited liability company and a member frm of the KPMG network of independent member frms
affliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
8 | Investment in Poland
Chapter 1
Poland – a Brief Summary
1.4 Currency it is important to note that the PLN
exchange rate has been subject to strong
Polandijs offcial cVrrency is the zìoty (P-/)
ĜVctVations over the last.
which is subdivided into 100 groszy.
5he P-/ is sVbKect to a Ĝoating eYchange
rate applied to foreign currencies. The 1.5 Population and Language
acceptable ĜVctVation range of the market
Poland has 38.5 million inhabitants, 52%
rate towards the central one as quoted
of which are women. Over 98% of the
by the Central #ank of Poland (/#P) is
population is of Polish origin. More than
not restricted and is determined solely by
60% live in cities, of which almost 50%
market mechanisms. The 2012 average
live in communities of over 100,000
NBP exchange rates were: USD 1 =
inhabitants. The vast majority of Poles
P-/ 3.2 &63 1 .1 P-/. )owever,
() are 3oman Catholics. 3. of
PLN EXCHANGE RATE
5,0
4,8
4,6
4,4
4,2
4,0
3,8
3,6
3,4
3,2
3,0
2,8
2,6
2,4
2,2
2,0
USD / PLN EUR / PLN
Source: KPMG in Poland based on National Bank of Poland data
© 2013 KPMG Sp. z o.o. a Polish limited liability company and a member frm of the KPMG network of independent member frms
affliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
Investment in Poland | 9
POPULATION BY AGE GROUPS
Poland’s population is of working age.
Polish is the offcial language; it belongs
to the Indo-European group of languages
17,8% 18,3%
and is part of the West Slavonic language Pre-working age (0-17)
family.
Working age/mobility (18 -44)
Knowledge of foreign languages can be
Working age/non-mobility (45-59/64)
23,9%
rather limited, except in Poland’s main
Post-working age (60/65+)
cities. This situation is slightly better in
40,0%
organisations which have frequent contact
with foreigners. However, language
problems may arise in local institutions
17,8% 18,3%
and industrial enterprises.
Pre-working age (0-17)
English is best spoken in the major cities
Working age/mobility (18 -44)
and by the younger generation, whereas
Working age/non-mobility (45-59/64)
23,9%
German predominates amongst older
Post-working age (60/65+)
generation and in Western Poland. The
40,0%
older generation, especially in the east
Source: KPMG in Poland based on Polish
part of the country, knows Russian.
Central Statistical 0ffce data
1.6 Labour market universities, as well as highly esteemed
medical academies. More than 492
As much as 17% of people aged over 13
thousand people graduated in 2011, of
have completed higher education, with
which 122 thousand majored in business
a considerably higher education level
and administration, 8.7 thousand in law,
among women (19%, compared with
10 thousand in biology, 6.9 thousand in
14.8% among men). What is more, the
physics, 4.2 thousand in mathematics and
qualifcation levels of the Polish workforce
statistics, 15.1 thousand in information
are constantly increasing. Currently there
technology, 28.1 thousand in engineering,
are 1.7 million students in 453 higher
14.4 thousand in manufacturing, 14.6
education institutions in Poland, including
thousand in architecture and construction
a large number of technical and business
and 42.6 thousand in medical studies.
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affliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
10 | Investment in Poland
Chapter 1
Poland – a Brief Summary
AVERAGE MONTHLY GROSS SALARY (PLN)
4 000 Labour costs in Poland are still well below
3 500
3 103 3 225 3 400 3 522 the average EU level, comparable to
3 000 2 691 2 944 Hungary and Slovakia and lower than in
2 500 2 477 the Czech Republic. The average monthly
gross salary amounted to about PLN
2 000
3.5 thousand (EUR 841) in 2012. The
1 500
unemployment rate amounted to 13.2%
1 000
at the end of H1 2013. However, it is still
500 below the levels recorded in 2000-2006,
0 when unemployment ranged from 15 to
2006 2007 2008 2009 2010 2011 2012
20%.
Source: KPMG in Poland based on Polish Central
Statistical 0ffce data
REGISTERED UNEMPLOYMENT RATE
16,0% 14,8%
14,0% 13,4%
12,1% 12,4% 12,5%
12,0% 11,2%
10,0% 9,5%
8,0%
6,0%
4,0%
2,0%
0,0%
2006 2007 2008 2009 2010 2011 2012
Source: KPMG in Poland based on Polish Central
Statistical 0ffce data (end of period)
1.7 Economy and foreign investment, Poland’s economy
became the strongest in CEE. What is
After the political changes in 1989 and the
more, in the 21st century it remained one of
transition to free-market economy, Poland
the most stable and healthy economies in
achieved considerable economic success.
Europe. This was particularly visible in 2009
Driven by extensive internal demand, exports
© 2013 KPMG Sp. z o.o. a Polish limited liability company and a member frm of the KPMG network of independent member frms
affliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
