How to Open a Sole Proprietorship (FOP) in Poland for Foreigners: Step-by-Step Guide

Poland is becoming increasingly attractive to foreign entrepreneurs thanks to its stable economy and simplified business conditions. Opening a sole proprietorship (FOP, or Jednoosobowa Działalność Gospodarcza) in Poland is a practical and accessible option for foreigners wishing to start a business. In this article, we’ll outline who can open a sole proprietorship, the necessary documents, and the registration process.

Who Can Open a Sole Proprietorship in Poland

Foreigners must meet specific requirements to open a sole proprietorship in Poland. The primary condition is having a legal status in the country that permits entrepreneurial activity.
Eligible individuals include:

1. Citizens of the EU and EFTA (Norway, Switzerland, Liechtenstein, Iceland) can register a sole proprietorship on the same terms as Polish citizens.2. Citizens of other countries (e.g., Ukraine, Belarus, Russia) can open a sole proprietorship if they possess one of the following documents:

● Permanent residence permit or EU long-term resident status.
● Temporary residence permit issued for reasons such as:

● Studying at a Polish university.
● Family reunification.
● Marriage to a Polish citizen.

● Pole’s Card (a document confirming Polish heritage).
● PESEL with "UKR" designation (for Ukrainian citizens who arrived after February 24, 2022).

Advantages of Opening a Sole Proprietorship in Poland

● Simple Registration: The process takes only a few days and can be completed online.
● Flexible Tax System: Entrepreneurs can choose from several taxation systems depending on their business type. ● No Share Capital Required: Unlike companies, there is no need to contribute capital. ● Simplified Accounting: Small businesses can use simplified tax accounting.

Step-by-Step Guide to Opening a Sole Proprietorship

1. Obtain a PESEL NumberA PESEL (Personal Identification Number) is required for conducting business and interacting with government institutions. To obtain it, apply at your local municipality office (gmina).
2. Register with CEIDGThe Central Register of Economic Activity (CEIDG) is a government database of all sole proprietors in Poland. Registration is done via the website ceidg.gov.pl by filling out the CEIDG-1 form, which requires:

● Personal information.
● Business activity details (using PKD codes).
● Taxation method selection.

3. Choose a Taxation MethodPolish law offers several taxation systems for entrepreneurs:

● General taxation (skala podatkowa): Tax rates are 12% or 32%, depending on income.
● Flat tax (podatek liniowy): A fixed 19% rate regardless of income.
● Lump-sum tax on registered income (ryczałt): Suitable for certain business types, with rates depending on the activity category.

4. Register with ZUSAfter business registration, file an application with the Social Insurance Institution (ZUS) to pay mandatory contributions. These include health, pension, and other social insurance payments.
5. Open a Bank AccountWhile personal accounts can be used for small transactions, it’s recommended to open a dedicated business account to simplify accounting.

Responsibilities of Entrepreneurs After Registration

Once registered, a sole proprietor must:

● Maintain accounting records as per the chosen taxation method.
● Pay taxes and insurance contributions on time.
● Comply with licensing requirements (if the activity requires special permits).
● Stay updated on tax code changes and current regulations.

Tips for a Successful Business Start

1. Consult an Accountant: This helps you choose the best taxation system and avoid mistakes.
2. Research the Market: Analyze competitors and understand customer needs before launching your business.
3. Organize Your Documents: Ensure your permits and documents meet all requirements.

Opening a sole proprietorship in Poland is a relatively simple process if you meet the requirements and follow the registration steps. This business format is ideal for freelancers, artisans, and entrepreneurs looking to start a small enterprise.
If necessary, seek assistance from lawyers or accounting firms to make the process even easier.