Krakow, a historic city in Poland, is not just a cultural gem but also a burgeoning hub for international business. Krakow is a strategically located entry point into the European market for Indian businesspeople wishing to enter the import-export industry.
This comprehensive guide will help you understand why and how to register an import-export business in Krakow, outlining the steps, required documents, business structures, tax regulations, and incentives.
Why Register an Import-Export Business in Krakow as an Indian Entrepreneur?
Strategic Location and Market Access
Krakow’s strategic location in Central Europe provides unparalleled access to the European Union’s vast market. Krakow’s superior logistical infrastructure, which includes air, road, and rail connectivity, makes it a perfect starting point for effectively reaching millions of customers throughout Europe.
Business-Friendly Environment
Poland, and Krakow in particular, boasts a business-friendly environment with supportive policies for foreign investors. The Polish Investment and Trade Agency (PAIH) aggressively encourages foreign investments and offers global companies a wide range of support services.
Skilled Workforce and Innovation
Krakow is home to some of Poland’s leading universities and research centres, ensuring a steady supply of highly skilled professionals. Because of the city’s emphasis on innovation and technology, it’s a great place for companies who want to use cutting-edge technologies in their daily operations.
Competitive Costs
Krakow has favourable operating costs, including reduced labour, living, and office rental prices when compared to other major European cities. The financial benefit of this advantage can greatly increase your import-export company’s profitability.
Steps for Registering an Import-Export Business in Krakow for Indian Entrepreneurs
Select the Proper Organizational Structure
Poland offers several business structures, each with unique rules and advantages.
The most common structures include:
- Sole Proprietorship
- Partnership
- Limited Liability Company (Sp. z o.o.)
- Joint-stock Company (S.A.)
For import-export businesses, a Limited Liability Company (Sp. z o.o.) is frequently the best option because of its adaptability and restricted liability for stockholders.
Name Reservation
Make sure the name you have selected for your company is available on the National Court Register (KRS) portal.
Draft Articles of Association
Draft the Articles of Association, which describe the shareholders, organizational structure, and guidelines for the operations of the company. This document must be notarized.
Register with the National Court Register (KRS)
Submit your application to the KRS, including the Articles of Association, proof of registered office, and identification documents of the shareholders.
Obtain a REGON Number
Register with the Central Statistical Office (GUS) to receive a REGON number, which is necessary for statistical purposes.
Set up a Bank Account
Set up a corporate bank account in Poland. All business-related financial transactions will be made using this account.
Enrol for VAT and Social Security
Enrol for Value Added Tax (VAT) and Social Security (ZUS) at the local tax office. This step is crucial for compliance with Polish tax regulations.
Documents Expected to Launch an Import-Export Business in Krakow for Indian Entrepreneurs
- Passport Copies: Valid passports of all shareholders and directors.
- Proof of Address: Recent utility bills or bank statements.
- Articles of Association: Notarized and translated into Polish.
- KRS Application Form: Completed and signed application form.
- REGON and VAT Registration Forms: Completed and signed forms.
- Bank Account Details: Confirmation from the bank.
Business Structures Available to Start an Import-Export Business in Krakow for Indians
Sole Proprietorship
This structure is suitable for small enterprises. It requires minimal capital and is easy to set up, but the owner bears unlimited liability for business debts.
Partnership
Partnerships can be general or limited. They involve two or more individuals who share profits and liabilities.his structure works well for companies where collaboration is essential.
Limited Liability Company (Sp. z o.o.)
A Limited Liability Company is the most popular choice for foreign entrepreneurs due to its limited liability and flexible structure. A minimum of 5,000 PLN in share capital is required to form an LLC in Poland.
Joint-stock Company (S.A.)
This structure is suitable for large businesses planning to issue shares to the public. It has stricter rules and requires a higher minimum share capital of PLN 100,000.
Tax Regulations and Incentives in Krakow
Corporate Income Tax
The standard corporate income tax rate in Poland is 19%. However, small businesses with revenues up to EUR 2 million can benefit from a reduced rate of 9%.
Value Added Tax (VAT)
The standard VAT rate in Poland is 23%. Certain goods and services are subject to lower rates of 5% and 8%, nevertheless. For import-export businesses, it’s crucial to understand VAT regulations to ensure compliance and optimize tax liabilities.
Customs Duties
Businesses that import and export must abide by EU customs laws. As a member of the EU, Poland abides by the Union Customs Code, which streamlines customs processes and promotes trade.
Investment Incentives
Poland provides a range of incentives to foreign investors, including grants and subsidies for R&D, as well as tax exemptions in Special Economic Zones (SEZs). These incentives have the potential to greatly lower operating expenses while raising profitability.
Conclusion
Krakow is an excellent destination for Indian business owners wishing to set up an import-export business. It is a great option because of its advantageous location, highly qualified staff, affordable prices, and welcoming business climate. By following the outlined steps and understanding the regulatory framework, you can seamlessly register and launch your business in this vibrant city.
OnDemand International has a proven track record of assisting businesses in navigating the Polish economy. We can help you register your import-export business in Poland within 2-4 weeks. Contact OnDemand International for a hassle-free business incorporation today.
FAQ’s
The minimum share capital needed to set up a Limited Liability Company (Sp. z o.o.) in Poland is PLN 5,000.
Small businesses with revenues up to EUR 2 million can benefit from a reduced corporate income tax rate of 9%.
Krakow’s advantageous location, expanding economy, and accessibility to European markets make it a top choice for Indian businesspeople looking to expand internationally.