A civil-law partnership
A civil-law partnership is neither an entrepreneur nor a separate business entity. Its partners are considered entrepreneurs in the scope of their business activity.
A civil-law partnership is only the name of a deed of partnership executed by at least two entrepreneurs, under which they undertake to pursue a common business goal by acting in a specified way, especially by making contributions.
A civil-law partnership is not obliged to follow the provisions of the Accounting Act (comprehensive bookkeeping is not required); such an obligation will arise if its net earnings from the sale of goods, products and from financial operations in the previous fiscal year amounted to at least an equivalent of 1 200 000 € in PLN.
Despite having no legal personality, in the light of the Labour Code, a civil-law partnership may be an employer for its employees and partners - as long as other conditions provided by law are fulfilled.
A civil-law partnership may be transformed into any commercial company. The rules are simplified for a transformation into a registered partnership.
Preferrend form of activity |
Conducting business activity on a relatively small scale by a minimum of two entities. |
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Purpose |
Under the deed of partnership partners undertake to pursue a common business goal. |
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Company |
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Legal personality |
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Appropriate register |
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Minimum capital |
Minimum capital not required. |
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Founders/partners |
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Partnership's lifetime |
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Type contract |
The deed of partnership has to be made in writing. Note: certain contributions to the partners’ joint property require an exceptional form, e.g. of a notarial deed if real estate is to be the contribution.The deed of partnership of a civil-law partnership has to specify:
The obligation to make a contribution does not have to lie on all partners, but it does lie on at least one of them. Contributions may be in cash or in kind – partners may transfer the ownership or the use of a specific thing (e.g. hardware, premises, a vehicle) or assume an obligation to perform specific tasks or actions (e.g. seeking customers, bookkeeping),
The deed of partnership may also settle other issues which may help frame the partners’ relationship according to their needs. In the absence of partners’ provisions, rules provided in articles 860-876 of the Civil Code (KC) |
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Partnership's assets |
Constitute the partners’ joint co-ownership and cannot be divided in the partnership’s lifetime. |
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Partnership's representation |
In the absence of other provisions - each partner is authorised to represent the partnership. A partner may be deprived of this right pursuant to the deed of partnership or a partners’ resolution. |
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Managing partnership's affairs |
Managing the partnership's affairs is each partner’s right and obligation. Scope of authorisation to manage the partnership’s affairs:
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The rules of managing and representing a civil-law partnership are not effective in regard to cash available in a joint bank account. In case of a joint bank account kept for natural persons, unless its contract provides otherwise, every co-owner may:
The above mentioned issues may be regulated differently in a bank account contract of partners of a civil-law partnership. (article 51 and article 51a of the Banking Law). |
Taxation |
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ZUS premiums |
Note: beginner individual entrepreneurs have the right to a so-called Small ZUS, that is lower social premiums for the first two years of activity. These premiums are paid based on a decreased assessment, that is a 30% of the projected average monthly salary. | |
Liability |
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Actions necessary to commence activity in a civil-law partnership:
- Concluding the deed of partnership, as a rule, in writing.
- Entering the partners (natural persons) in the Central Registration and Information on Business.
When natural persons want to conduct activity in a civil-law partnership each of them has to have a CEIDG entry (all sections of the form concern the data of an entrepreneur-partner, not the partnership) and update it with the partnership’s NIP and REGON afterwards.
When a person who already is in the CEIDG becomes a partner, his obligations are limited to completing the information on the partnership and making other potential changes connected to commencing activity in the partnership, e.g. broadening the scope of activity.
The CEIDG-1 form has also the no. 27 section regarding marital property system!!!. This section has to be completed if the applicant has community of property with a spouse. It also has to be completed in the case of cessation of such community (if a separate property system occurred).
ZUS registration.
A partner in a civil-law company pays his own ZUS premium (like in case of a single-member company).
A partnership is a premium payer for persons performing work for it (e.g. employees and contractors) but there is no need to complete and submit an application in ZUS, because ZUS prepares the first premium payer declaration (ZUS ZFA form) based on information provided in the CEIDG-1 application.
Inland Revenue Office registration
To acquire a NIP number for the partnership, the NIP-2 application with the NIP-D appendix has to be submitted.
An entrepreneur with a status of a VAT payer is obliged to submit a VAT-R registration application to the Head of the Inland Revenue Office .
On 1st January 2015 the obligatory duty to confirm VAT-R registration application was abolished. The Head of the Inland Revenue Office will confirm a taxpayer’s registration only at his request (confirmation procedure is subject to stamp duty of 170 PLN).
Upon the execution of the deed of partnership arises an obligation to pay the tax on civil-law transactions. The tax rate is 0.5% and the taxable base is the value of the contributions. The partnership has to submit declarations (PCC-3, PCC-3A) and pay the tax in the Inland Revenue Office adequate to the partnership’s registered office within 14 days of the execution of the deed of partnership. This excludes a deed of partnership made up in a notarial deed form – the notary collects and settles the tax then. In such case, the notary’s remuneration (the notarial fee) plus VAT for drawing up the deed of partnership is deducted from the taxable base.
Applying for REGON number in the National Official Register of Nationalised Industry Units
RG-OP and RG-SC applications have to be submitted in a statistical office (its branch) of the voivodeship where the partnership’s registered office is. There is also a possibility to submit the application online. In such case a secure electronic signature is required.