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A South African moving to Poland with Polish wife- we live in London. Excited and scared.


Kurt 2 | 29
16 May 2011 #1
Hi

This is my first post ever but i have read a few conversations and found the info very helpfull.

My wife and I are considering leaving London to go and settle in Krakow with our 4 year old daughter in august, my wifes wants to complete her studies in Poland.

I have my own energy consultancy registered in the UK will i be liable to pay tax in Poland even though i will not be earning in poland? my marriage is registered in Poland since 2008 will i still need to wait 3 yrs to apply for Polish citizenship once i live in Poland?

Anyways guys and girls, I am excited and scared, if there are any cool peeps around krakow that would like to keep in contact and perhaps meet up for a beer that would be good, If anything i would like to have my own circle of friends and not rely on my wifes friends...
Lodz_The_Boat 32 | 1,535
16 May 2011 #2
Hello Kurt, welcome to Poland. So you are a South African with a business in London and looking for a citizenship in Poland? :D :) ... nice!

OK, since you are married and have a child through her, it shouldn't be so difficult to get a citizenship. The best place to know would be the Polish embassy in your country.

But in any condition, have a happy stay.

Oh and by the way, I don't think you will need to pay taxes in Poland, but only those taxes which you will have to pay to bring in the money to spend in Poland.
Zman
16 May 2011 #3
I would be just as scared to go to South Africa..... :-) or more, from what I heard!
al111 13 | 89
16 May 2011 #4
my marriage is registered in Poland since 2008 will i still need to wait 3 yrs to apply for Polish citizenship once i live in Poland

You won't have to wait for 3years mate. Yours is quite simple "theoratically" you will need to get yourself a residence card when you arrive which will be valid for 2years.Since you've already been married to your missus for 3years now you'll be eligible to apply for permanent residence after 2years of uninterrupted stay in the country. Meaning you cannot live outside Poland for more than 6months continuous. However as a word of caution your situation can be very tricky as well. If you guys are gonna live off your UK earnings while she is studying full time when it comes to applying for citizenship they might ask for tax returns. In this country they like foreigners who pay taxes to the government if one day you're gonna become a citizen.My advice would be that you'll need legal advice when applying for citizenship on this issue otherwise you'll need to find work or register a company thats the easiest.Find out as much information as you can cause here what applies in Poznań might not apply in Kraków. Good luck to you two.
poland_
16 May 2011 #5
register a company thats the easiest

In the situation of the OP, that is exactly what I would do, set up a company Poland as the PL arm of the UK Ltd.
Wroclaw Boy
16 May 2011 #6
I'd just keep the limited company running as is - in the UK with a virtual address (costs about £20 a month) if need be, pay taxes there and filter the money out as required. You dont want to be getting bogged down with all the Polish bureaucratic crap.
OP Kurt 2 | 29
18 May 2011 #7
Hi Londz. cheers for you comments, I have discussed the citizenship with the Polish Embassy in London and they to confirm i can apply for Polish citizenship after 2 years of uninterrupted stay and this can be done through municipal office in Poland from what I heard.

The challenge however is the tax in Poland what I have found out is that a person is classified as a resident if your stay is more than 184 days and also irrespective if your business is registered in the UK if your main business activities are from Poland you would be liable to pay tax in the country i.e Poland.

In response to the other comments from others, firstly thanks appreciate it!

Paying tax in Poland seems the obvious thing to do if i intend to live permanantly but the problem is the earnings after 85000PLN is taxed at 32% anythign before that is taxed at 19% 85000ZL is around £20,000 i turn over more than 20K and 32% seems a bit heavy :-) in the UK its 21% up to 1.5Mil, What benefits would i have by opening a branch in Poland as part of the HQ in UK?

Oh and sorry for the delayed reply, i was checking in "private mail" to see if anyone responded :-(

I am thinking of setting up a business in Poland once i have settled in but something different from what i am currently doing... would be happy to meet like minded people in krakow or near.
Harry
18 May 2011 #8
Set yourself up as a one-person company here and you pay a flat rate tax of 19% (plus 750zl per month ZUS, although it is reduced to about 250zl per month for the first two years).
OP Kurt 2 | 29
18 May 2011 #9
Harry- any idea where i can research information to set up as one-person company and is that 19% apllicable only to earnings below the 85000zl mark? or will all earnings be taxed at 19%
poland_
18 May 2011 #10
What benefits would i have by opening a branch in Poland as part of the HQ in UK?

None its a hassle, it is easier to open a company, here are the different types of company in PL.

Polish law allows many forms of doing business on its territory. In conformity with The Code of Commercial Companies, published in The Official Gazette of Poland No. 94, pos. 1037, the main categories of enterprises are as following:

bridgewest.eu/article/polish-company-types

100 words + URL
Harry
18 May 2011 #11
Harry- any idea where i can research information to set up as one-person company and is that 19% apllicable only to earnings below the 85000zl mark? or will all earnings be taxed at 19%

No idea where you can find that info online but it's a piece of cake to set one up. As for tax rate, you pay 19% flat tax no matter how much you earn. I'm told that there is an option to pay a lower rate (17%?) on everything under a certain sum (60,000zl?) and then a higher rate (33%?) on everything above it but I don't personally know. However, I do know from personal experience that it is 19% flat whatever you earn, if you choose that option.
OP Kurt 2 | 29
18 May 2011 #12
thanks guys, also just a quick question is there a market for importing clothes and selling it in Poland?
i will do some research on the tax when opening a company in poland..
Trevek 26 | 1,702
18 May 2011 #13
If anything i would like to have my own circle of friends and not rely on my wifes friends...

Not in Krakow, but I have an Afrikaans friend up here in Olsztyn.
delphiandomine 83 | 17,722
18 May 2011 #14
However, I do know from personal experience that it is 19% flat whatever you earn, if you choose that option.

18/32% at the moment. The thing with the flat tax is that it isn't open for all business types - and as I recall, with the flat tax, you don't have the ability to dock off everything in sight too.

thanks guys, also just a quick question is there a market for importing clothes and selling it in Poland?

Nope. The market is pretty much sewn up by Poles abroad trading directly with Poles here - unless we're talking about luxury brands. But bear in mind that many people involved in this industry are happy to work for 1500zl a month profit - are you?

The challenge however is the tax in Poland what I have found out is that a person is classified as a resident if your stay is more than 184 days and also irrespective if your business is registered in the UK if your main business activities are from Poland you would be liable to pay tax in the country i.e Poland.

Correct. However, if you merely draw dividends from a UK business - then it's a flat 19% tax on all dividends. However, I can't see it making much sense - you'll have to pay UK corporation tax, then the 19% in Poland on top - so effectively a tax rate of around 40%.

It's not based on turnover, but rather profit. But yes, taxes are much higher in Poland than in the UK - the tax base is very, very low here. On the other side - you can get away with murder when it comes to company expenses, unlike in the UK.

Apparently the best tax dodge at the minute is to open a company in Cyprus, due to some treaty between Poland and Cyprus that results in an effective 9% tax rate. But Tusk wants to close this loophole - so don't rely on it.
OP Kurt 2 | 29
19 May 2011 #15
delphiandomine
(Correct. However, if you merely draw dividends from a UK business - then it's a flat 19% tax on all dividends. However, I can't see it making much sense - you'll have to pay UK corporation tax, then the 19% in Poland on top - so effectively a tax rate of around 40%. )

My accountant is looking into this for me, from what I have read on the HMRC website and from conversations with Polish consulate you cannot be taxed in 2 countries, you can choose to pay tax in the UK for example or in Poland its finding out whats the best option.. this is what i am trying to establish, I have been sent a quote from a Lawyer in Poland to provide advice however they want to charge me 900Euro, thats seems a bit pricey for advice :-)..

As for the clothing 1500zl is not profit margins to get excited about, what I am hoping to achieve is to not pay tax in Poland on my UK business and keep all my taxes etc in UK, and if i can open a small business in Poland just to show I am atleast paying taxes to the goverment might make things less complicated when it comes round to apply for citizenship, i think they might frown if i have been living in the country spending pounds and paying taxes in UK but want to apply for Polish citizenship..

appreciate everyones suggestions....
Harry
19 May 2011 #16
In that case, just open a one-person company to teach English. Make up fictitious clients, get paid in cash by them for 2,000zl per month, chuck the Polish government 80 quid a month for tax on your 'income' in Poland and Robert is your mother's brother. Simples.
poland_
19 May 2011 #17
However, I can't see it making much sense - you'll have to pay UK corporation tax, then the 19% in Poland on top - so effectively a tax rate of around 40%.

The way is to set up a Polish Limited Partnership (Spólka komandytowa) and create a consultancy contract with the UK Ltd. If there was no profit in the UK Ltd, there would be no corp tax. Take dividends from the SK 3 or 4 times a year and pay tax in PL.
Torq 26 | 2,371
19 May 2011 #18
Make up fictitious clients, get paid in cash by them for 2,000zl per month, chuck the Polish government 80
quid a month for tax on your 'income' in Poland and Robert is your mother's brother. Simples.

Really, Harry. *disgusted facial expression*

I don't think our friend Kurt wishes to have an uncle named Robert, if being a nephew
of this individual involves cheating the Polish government.
Harry
19 May 2011 #19
In the scenario I propose, Kurt would not be cheating the Polish government, quite the reverse: Kurt would be paying tax to the Polish government on income which he did not actually receive! So if anybody would be getting cheated, it would be Robert's nephew, i.e. Kurt. Much like those of us who pay fairly vast amounts of tax here and in exchange receive sweet Fanny Adams in the way of services.
hague1cmaeron 14 | 1,377
19 May 2011 #20
My wife and I are considering leaving London to go and settle in Krakow with our 4 year old daughter in august, my wifes wants to complete her studies in Poland.

Good luck, I hope you enjoy it, I have a weak spot for South Africns. I find South Africans to be some of the warmest individuals one can hope to meet.
Lodz_The_Boat 32 | 1,535
19 May 2011 #21
appreciate everyones suggestions....

I've worked in the clothing industry. Where will you import from?... any plans? On the basis of that I can suggest.

Also what will you import? - Knitwear, woven or sweaters or others? ... which end? ... Do you know how you will market them?

You cannot just wake up one morning and say "I wanna import and make money" :)

I have a weak spot for South Africns.

Me too... also Mr. Nelson Mandela ... and then there are other good people. They are good in almost every sport. I mean, they can play any of the many kinds of sport.

In South Africa, as they say, "Its Possible" :D
al111 13 | 89
19 May 2011 #22
Howzit Kurt?

To be fair on you mate you need to look at the time factor as well. Don't set up something thats gonna be a hussle for you here in polska just for the sake of avoiding to pay too much tax. There are some type of companies that might take you to the cleaners when it comes to closing up shop. Just open a one-person company and pay the little ZUS fees(for the first 2years) and the little tax you can afford according to your earnings. You could get your wife to open it as the owner and you the employee and after 2 years close up shop because of slow down in business. Make sure you get the company registered after you get your residence card. If you looking to settle beyond the 2year period you've mentioned then you might need good advice on all this.

a Lawyer in Poland to provide advice however they want to charge me 900Euro, thats seems a bit pricey for advice :-)..

You darn right thats paying through the nose mate, they only do that the moment you tell them you're a foreigner it's like they've hit the jackpot put your wife into the mix let her speak to them in polish and you will find out that you won't even pay half of that here in Polska. It has worked for me many times...
OP Kurt 2 | 29
19 May 2011 #23
Im good AIl11, cheers will deifnately look into that, We going over to Krakow next week to look at a view properties to rent in the city centre.

@-Londz, clothing is not something i have really given much thought but had a conversation with someone and it appears there might be an opportunity to make some Zl :-) .

I have a few connections in Cape Town and JHb where i can pay around £2 for T-shirts etc. there is also a possibilitie of getting things directly from China.... to be honest this is not something i will put allot of time into because the profit margins potentially will be rather small.

Ideally i would like to approach stores maybe get them to buy large orders from me and just sell it in their shops. i propably would consider hiring someone to stand a market stalls etc..

What about native speaker? how does that work?
Harry
19 May 2011 #24
What about native speaker? how does that work?

One-to-one lessons in a coffeeshop or their office, whatever style the student wants (usually basically a chat with a bit of grammar thrown in), cash in hand at end of lesson. Problem is that Krakow is stuffed with 'teachers'.
poland_
19 May 2011 #25
I have been sent a quote from a Lawyer in Poland to provide advice however they want to charge me 900Euro, thats seems a bit pricey for advice :-)..

Why would you go to a lawyer in Poland to get tax advise?

The lawyer will sit you down listen to what you have to say and then put you in contact with a tax specialist and charge you for 1 or 2 hours.

You or your account should contact HMRC, fill in the correct forms and become a non resident of the UK for tax purposes, you can travel the Uk, but you cannot spend longer than 180 days in one calendar year.

Just open a one-person company and pay the little ZUS fees(for the first 2years) and the little tax you can afford according to your earnings. You could get your wife to open it as the owner and you the employee and after 2 years close up shop because of slow down in business.

Listening to people that are school teachers or running a market stall will cause you problems, your situation is different,you will have cross border transactions and you need to be seen to following the rules and laws correctly. until you actively start business in PL you will only have one client the UK Ltd.

al111 - From my experience it is not this way, many foreigners go to the wrong people to get advice. Example going to a lawyer to get tax advice: Most Polish professionals - Lawyers, Accountants, Tax advisors are honest, but if someone does not have a knowledge or experience of what they are doing, they will make mistakes and it will cost them.
OP Kurt 2 | 29
19 May 2011 #26
@warsazawski- could you reccomend someone to talk to in Krakow?
poland_
19 May 2011 #27
I could recommend a company in Warsaw, but not Krakow.


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