Setting up Independent Contractor & freelancer taxes in Poland

Set up as an independent contractor in Poland by registering a Jednoosobowa działalność gospodarcza.

To register a sole proprietorship in Poland, the CEIDG-1 form must be completed. This registration form is for the Central Register and Information on Economic Activity in Poland. Registration is free and can be completed online, in person, or via registered mail. Form CEIDG must be signed prior to submission.

The request for registration in the Central Register and Information on Economic Activity must include the following:

• the business description and the PESEL registration number (if applicable)
• entrepreneur's date of birth, citizenship, and place of residence, or a business address (if the activity takes place at a specific address)
• the entrepreneur's SSN and REGON number (if applicable)
• company name (which shall contain at least the name and surname of the entrepreneur)
• the subject of commercial activity according to the Polish Classification of Activities (PKD)
• the date of commencement of business, the income tax payment form, and contact information

In addition to the CEIDG application form, one must provide a declaration regarding the lack of judgments prohibiting the operation of economic activity, the practice of a certain profession, or the operation of an activity involving the raising, treatment, education, or care of minors.

Polish REGON and NIP Numbers

REGON (Rejestr Gospodarki Narodowej) is the Polish National Business Registry Number (Rejestr Gospodarki Narodowej) (statistical number). Any firm conducting business in Poland, including sole proprietorships, must be registered in the REGON registry. The Central Statistical Office is responsible for assigning REGON numbers. Individual entrepreneurs acquire a REGON number upon registering with CEIDG. The REGON number groups the entity's information, such as the company's name, the owner's name, and the owner's PESEL, among others.

The NIP (Tax Identification Number) is a 10-digit number used to identify tax-paying enterprises in Poland. It is automatically assigned upon business registration.

Establishing an Enterprise Bank Account in Poland

An entrepreneur is required to create a bank account in Poland.

The criteria for opening a bank account vary by bank, however in general you will need the following:

• ID card certificate of registration in CEIDG copy of the certificate of the REGON and NIP numbers company's stamp
• Poland's Taxation of Independent Contractors

Alternatively, you can use Abillio - invoicing and tax compliance service for cross-border freelancing. In Abillio's case, you don't need to establish a legal entity, open bank account or apply for VAT - with Abillio's company-as-a-service solution you can start your freelancing business right away. Register your free account here >>

Taxation

Individual entrepreneurs are subject to a flat 19% tax rate in Poland. Under the flat-rate tax system, there are no personal allowances or tax credits, with the exception of credits for mandatory health insurance contributions.

Individual entrepreneurs may also opt for taxation under general regulations. In this instance, progressive taxation with two tax rates based on annual income applies:

- income up to PLN 85,528,00 - tax rate of 17%;

- Income in excess of PLN 85,528,00 is taxed at 32%.

Health insurance

Through the National Health Fund, or NFZ, all citizens and foreign residents of Poland have access to health insurance. This is controlled by the Polish Ministry of Health. You will be responsible for a monthly payment of 37.80 PLN to participate in this insurance plan. You can easily apply for NFZ benefits by submitting a completed application form, a copy of your passport, and any other required documentation based on your status as a citizen, foreign resident, or student.

Once you have finished the NFZ registration process, you will have total access to all of the NFZ's benefits. Prescription drugs, dental care, physician care, hospitalizations, inpatient treatment, and specialist care are among the many perks.

VAT

Self-employed individuals engaged in taxable economic activity in Poland are required to register for VAT if their yearly revenue exceeds or equals PLN 200,000. If you are an expat freelancer operating in Poland, however, there is no registration threshold, therefore you must register for VAT prior to engaging in taxable economic operations.

In Poland, freelancers are required to pay VAT on the goods and services that they sell to clients and customers in Poland and also to countries inside and outside of the European Union. The standard VAT rate is 23%. However, there are some rules for a VAT exemption and reduced rates - which are 8% and 5%.

Alternatively, you can use Abillio - invoicing and tax compliance service for cross-border freelancing. In Abillio's case, you don't need to establish a legal entity, open bank account or apply for VAT - with Abillio's company-as-a-service solution you can start your freelancing business right away. Register your free account here >>

Note: This information is from official sources and should not be considered as a substitute for legal advice. Always check official websites or consult a lawyer or tax consultant before taking action.