Polish law distinguishes many different forms of business activity. Apart from the simplest, sole proprietorship, the legislation also regulates the establishment of various types of companies. Contrary to the common stereotype, they are all for the people and any entrepreneur can set them up. They differ mainly in the form of liability and the way in which taxes are settled. It is therefore worth familiarising yourself with their definitions and seeing how they differ.
Categories of economic activity - what exist?
Most people who think of their own business think of a sole trader. Often understood simply as a single person providing personally performed services. For many people, companies of any kind are something distant - businesses that exist in some area beyond the reach of ordinary citizens. Meanwhile, although it is actually large companies that usually take the form of a company, an individual business can employ employees and a company can be set up by several citizens performing services in person. It all depends on what we want to achieve in our business. So let's briefly discuss the categories of business and the differences between them:
- sole trader,
- civil partnership,
- general partnership,
- partnership,
- limited partnership,
- limited joint-stock partnership,
- limited liability company,
- joint stock company .
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Sole trader
The first category mentioned, which I am sure we are all familiar with, is by far the simplest form of running your own business. In order to register a sole proprietorship, you do not need to visit an office - all you need is access to the web and a visit to the CEIDG website. You do not need a minimum contribution to get started, which makes things easier and minimises the risk of possible losses. When it comes to settling accounts with the tax authorities, you will have a choice of three forms of taxation: general tax, flat rate or tax card. As a sole trader, you may employ staff. However, remember that you are liable for the company's obligations with all your assets.
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Civil partnership
Another type of business is a civil partnership - you will need a partnership agreement to set this up, so you will need a trusted partner. It is usually entered into by entrepreneurs who already have their own businesses and want to join forces. It is worth knowing that a civil law partnership does not have legal personality, but its founders must be registered in the CEIDG. As far as tax issues are concerned, each partner will settle accounts independently. This category of business is characterised by its extreme manageability.
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General Partnership
A general partnership is said to be the least complicated legal form of business. In order to register, the partnership agreement must be concluded in writing at the outset and the company registered with the National Court Register. Each partner will be liable for the obligations of the business with all their assets. A general partnership does not pay income tax - this will be paid individually by each founder.
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Partnership
For this type of business, two natural persons who practice a liberal profession on a daily basis are needed. The contract should be concluded in the form of a notarial deed and then the company must be registered with the National Court Register. The partners are responsible for accounting with the tax authorities - each of them individually has to pay the due tax. The name of the company should include the name of at least one partner, together with an indication of the freelance profession.
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Limited partnership
As far as the limited partnership is concerned, in this category of business, one of the partners will be fully liable for the obligations of the company. The liability of the other members is limited to the limited partnership sum specified in the agreement. This type of business form will work well when the partners have different financial potential.
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Limited partnership
It is a distinct type of commercial law company. It is a combination of a limited partnership and a public limited company. The foundation of its operation is the articles of association - it must be signed by all general partners, while shareholders are required to give their written consent to the formation of the company. The share capital is PLN 50 000.
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Limited liability company
Another type of business activity is a limited liability company (sp. z o.o.) with legal personality. Its establishment requires the contribution of share capital in the amount of PLN 5,000. It can be run as a sole proprietorship or as a multi-partnership, and the liability of the partners is limited to the contributed capital.
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Public limited company
A joint-stock company is undoubtedly the best solution for entrepreneurs who want to enter the stock market. Establishing this category of business activity requires considerable share capital, as it is as much as PLN 100,000. This capital is treated as a contribution by the founders who are co-owners of the joint-stock company.
