Own business - first steps
Do you dream about your own business, but have concerns about starting it? Setting up a business is not as difficult as it may seem. Nevertheless, the key point is to have a business idea.
Own business - idea
The idea for your own business is one of the areas that is a strong starting point for building your own business. An idea for a business is something that can distinguish a given entrepreneur from others when he decides to enter the widely dispersed market, with great competition. Some people have great ideas but are afraid of the risk. Consequently, they prefer to work for someone and be dependent on others. This is often due to the fact that they are unable to calculate the benefits of running their own business, which, when compared to the risk, often exceed it. That is why people who have a business idea should not give up so quickly.
Life shows that an idea for a business is not always the same as coming up with something new, something that has not existed yet and which would constitute a certain innovation in the market sense. Sometimes a good moment to start a business is enough or finding a market niche where little competition allows for quite a lot of freedom in shaping the price. In fact, the success of your own business is influenced by many factors, and depending on the type and form of the enterprise, their impact varies.
Forms of economic activity
Depending on the type of activity and its nature, the entrepreneur must choose the form of activity. Establishing a company must consider whether his own business is to have legal personality, which responsibility to assume for the business, or what form of tax settlements he should adopt. The issues described below will allow you to familiarize yourself with the options available on the market that each entrepreneur must consider at the beginning.
Legal personality - means the ability of an organizational unit to be the subject of rights and obligations in civil law relations. It is connected with acquiring rights and incurring liabilities with one's own action and on one's own account as well as managing one's own property. Legal personality also allows for independent representation before courts and administrative authorities.
Due to having legal personality, the following forms of activity are distinguished:
- companies with legal personality - these are capital companies, i.e. a limited company and a joint stock company. The company acquires legal personality upon entry in the register;
- companies being the so-called handicapped legal person - these are organizational units without legal personality to which the law has granted legal capacity. They include partnerships (general partnership, limited partnership, limited partnership and limited joint-stock partnership), limited liability company. in organization, a joint-stock company in organization; ordinary associations and housing communities.
A handicapped legal person may acquire rights and incur obligations. She can also be sued and she can sue. The difference between legal entities is that the members of the company as a defective legal person are, in a way, liable for the obligations of that company.
- entities without legal personality - the last group consists of entities that do not have legal personality. They include civil partnerships and individual business activities of natural persons.
Own business activity - individually or as partners
If we decide to operate individually without partners, we can choose a sole proprietorship or a sole proprietorship company with limited liability. Let's get to know the advantages and disadvantages of each of these forms:
A sole proprietorship
|simple registration (one CEIDG-1 application)||responsibility with all your assets|
|simple administrative and accounting services||the entrepreneur pays ZUS contributions himself|
|choice of taxation (tax scale, flat tax, tax card, lump sum)|
|the possibility of receiving a subsidy|
|preferential social security contributions for the first 24 months|
One-person limited liability company
|separation of responsibility, lack of responsibility of the owner with his private property||each of the contracts between the sole shareholder and the company must be signed in the presence of a notary|
|full control||required share capital (min.5,000)|
|possibility of quick exit (sale of shares)||double taxation|
|keeping full accounting|
Conducting business with a partner
However, if we establish a company together with a partner or partners, first of all, we must trust them. The forms of activity in which partners may operate are civil law partnerships, partnerships and capital companies.
A civil law partnership is, more precisely, a civil partnership agreement concluded between partners who, if they are natural persons, must establish individual business activities. For what purpose, then, such a solution? It makes it possible to combine the resources of several people and their ideas into an uncomplicated structure with low installation costs. Usually, this form is used for small activities, often based on family ties in the business. Its main disadvantage is joint and several liability.
Other companies that require at least two partners are all partnerships and capital companies. They mainly differ in the detailed approach to responsibility for the company's obligations.
Responsibility for the obligations of your own business
Depending on the form of business activity, the owner or co-owner of the company may have a different degree of responsibility for overdue payments to contractors. The degree to which we will risk our own assets depends on the form of business we decide to conduct. Therefore, when a business idea is capital-intensive and is based on the exchange of high-value material, goods or services between contractors, it is worth shedding the responsibility for the company's obligations with your own assets, e.g. running a limited liability company.
The table below presents the characteristics describing the degree of responsibility of the owner / partner for liabilities incurred on behalf of the company being run.
|Form of business activity||Responsibility|
|Individual economic activity||- full, both with the company's assets and with its own|
|partnership||- joint and several for the company, self and partner, to an equal degree, both with individual assets and with joint property (the creditor may decide himself from which property he wants to cover his claims)|
|General partnership (partnership)||- joint and several for the company, self and partner|
|Partnership (partnership)||- personally and jointly and severally with all his assets only for the obligations of the partnership not related to the exercise of a freelance profession, each partner is personally responsible for himself / herself for the exercise of a freelance profession|
|Limited partnership (partnership)||- limited partner - liability up to the limited amount |
- general partner - with all his assets for the obligations of the partnership
|Limited joint-stock partnership (partnership)||- shareholder - is not responsible |
- general partner - with all his assets for the obligations of the partnership
|Limited liability company (capital company)||- the company is responsible for the obligations of the company with all its assets |
- partners are not liable for liabilities incurred on behalf of the company
|Joint stock company (capital company||- the company is responsible for the obligations of the company with all its assets |
- shareholders are not financially responsible for the company
Own business - tax and accounting settlements
The issue of tax settlements is related to properly kept accounting records. An entrepreneur setting up a company, depending on the adopted form of business, accounts for income tax according to various rules. The choice of the form of taxation and the form of accounting also depends on detailed restrictions included in the regulations. For example, a flat tax can only be paid by taxpayers running a business, as well as taxpayers running special departments of agricultural production. This rule, however, also has exceptions stating that taxpayers who obtain income from the provision of services to their former or current employer from independent business activity or from the right to participate in the profit of a company without legal personality (e.g. a civil partnership or general partnership) , corresponding to the activities that the taxpayer or at least one of the partners under the employment relationship or cooperative employment relationship:
- performed in the year preceding the tax year, or
- performed or performed in the tax year
have no right to tax their income on a straight-line basis.
Form of taxation. Characteristics. Form of accounting
|Personal income tax (PIT)|
|Tax scale||18% (reduced by the amount reducing the tax PLN 556.02) - income (income-cost) to PLN 85,528 - PLN 14,839.02 increased by a 32% surplus over PLN 85,528 Annual income not requiring the payment of tax PLN 3,091||Tax book of revenues and expenditures (KPiR)|
|Linear tax||19% of income, regardless of its amount||KPiR|
|Tax card||Individual rates specified in the announcement of the Minister of Finance||Tax card|
|Lump sum on recorded revenues||20%, 17%, 8.5%, 5.5%, 3% depending on the title from which the revenues are generated, details are specified in the Act of November 20, 1998 on flat-rate income tax on certain revenues obtained by natural persons → Art. 12||Income records |
|Corporate income tax (CIT)|
|General rules||19% The company's income is set according to general rules. |
19% Dividend income and other income from participation in the profits of legal persons established in the territory of the Republic of Poland.
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