Do you run a business and think you have too many official responsibilities? Do you have a problem with resolving your dispute in the office? Or maybe you are considering starting your own business, but you are afraid of complicated formalities and high social security contributions? New regulations for entrepreneurs will help you solve your problems. They will allow you, for example, to settle official matters more easily, recover your debt faster, or construct a company building without unnecessary formalities. They will also make it easier for young entrepreneurs to set up businesses.
Facilitations for entrepreneurs are introduced as part of the package of 100 Changes for Companies and the planned Business Constitution - a set of laws whose aim is to fundamentally change the regulations concerning business activity.
#100 Changes for Companies
The 100 Changes Package for Companies (in fact, there are just over 100 of them) of the Ministry of Entrepreneurship and Technology was announced in June 2016. It aims to remove the most burdensome rules that hinder business.
What is already working?
- A so-called deregulation law is in force. Among other things, it has extended the protection resulting from the dominant practice of interpreting individual interpretations of the law to include entrepreneurs (including those who have not applied for individual interpretations). The threshold of net income at which a company must maintain full accounting was also raised from EUR 1.2 million to EUR 2 million. Annual savings for one entrepreneur amount to even several thousand zlotys.
- Facilities for the construction industry have been introduced. Many construction machines no longer require a state test to operate. This saves 600,000 hours for construction site employees.
- The so-called debt package, which facilitates debt recovery, has entered into force and, as prevention is better than cure, it will prevent the creation of payment bottlenecks. At the same time, the amendment to the Code of Administrative Procedure entered into force. Thanks to it, officials cannot play ping ponga with us. They will deal with them more quickly and in partnership, e.g. with the help of a mediator.
- Business Constitution entered into force on 30 April 2018.
What is in the pipeline?
- Amendments to the rules on time limits for keeping staff records. It will be cheaper and simpler. Instead of 50 - 10 years storage. Instead of a stack of paper - electronic form.
- Introduction of new regulations facilitating generational change in family businesses.
- Introduction of a new type of entity - a simple joint-stock company, which will be an ideal solution for young, innovative companies.
This is the biggest change in economic law in recent years. The Business Constitution consists of a package of laws, the aim of which is, above all, to base the relations between entrepreneurs and the administration on partnership. The new regulations make it easier to set up a company and run a business. The most important document under the Business Constitution is the new Law of Entrepreneurs. It introduces the following principles:
- what is not prohibited by law, is allowed (an entrepreneur may conduct his business freely, if he/she does not violate prohibitions or restrictions explicitly indicated in the law)
- presumption of the fairness of the entrepreneur (the entrepreneur does not have to prove his fairness, doubts as the circumstances of a particular case will be settled in favour of the entrepreneur)
- friendly interpretation of the rules (unclear rules will be settled in favour of entrepreneurs)
- the principle of proportionality (the authority may not impose unjustified burdens on the entrepreneur, e.g. th authority may not demand documents which it already has)
The simplifications introduced under the Business Constitution include, among others:
- possibility of running a small business (monthly income up to 50% of the minimum salary, activity performed personally by persons who have not run their business for the last 5 years) without the obligation of registration
- exemption of new companies from the obligation to pay social security contributions for the first 6 months (not applicable to health insurance)
- the phasing out of the REGON number
- the appointment of a Spokesperson for Small and Medium-Sized Entrepreneurs
- publication of legal explanations for complex rules
- possibility of indefinite suspension of the company
- reorganising the catalogue of regulated activities (requiring concessions, permits) and reducing obligations for entrepreneurs
- possibility of dealing with simple official matters by telephone or e-mail
In August 2017, facilities for depreciation of plant and equipment came into force. Thanks to them, entrepreneurs can make one-time depreciation write-offs in the amount of up to PLN 100,000 per year. Taxpayers conducting business activity may make one-time depreciation write-downs on the initial value of new fixed assets acquired from the factory, classified as groups 3-6 and 8 of the Fixed Assets Classification, i.e. machinery and equipment ( real property and means of transport are excluded from such a deduction).
Second Innovation Act
As of 2018, facilitations under the so-called Second Innovation Act have been in place. Thanks to them, entrepreneurs can deduct from their tax base 100% of expenditure on research and development.
The new act, among others
- increases the R&D tax relief to 100%. (and 150% for Research and Development Centres - CBR)
- specifies and extends the catalogue of costs eligible for the R&D relief (by assets other than fixed assets, by forms of employment other than employment contracts). CBR will receive a wider catalogue of costs related to, inter alia, real estate)
- the R&D relief is available for some enterprises operating outside the Special Economic Zones
- extends until 2023 the exclusion of the so-called double taxation of companies and limited joint-stock partnerships engaged in R&D activity
- facilitates the financing of start-ups by clarifying how to tax a loan converted into shares