Stories of Polish companies like Booksy, UXpin, or Brand24 show that even if you’re a non-US startup, owning an entity in the US is invaluable in achieving global success. Many international founders realize that registering a startup in the US means better access to VCs and investors and potentially an easier road toward getting acquired or going public. The sooner you take an interest in registering a company in the US, the better off you will likely be in terms of financing rounds.
Registering a corporation in the United States when you're based in Poland may seem complicated, but it is actually rather straightforward. You do not need to be a visa holder or a US resident to establish a corporation in America, nor do you need a US mailing address.
You may be surprised that Polish citizens follow the same process when registering a Delaware C Corporation as all US residents.
Depending on your circumstances and the tools you decide to use, you may establish a US business from Poland in as little as 10 minutes. (Tip: it takes that long to incorporate using Capbase.)
This article will cover:
- The benefits of registering a startup in the United States
- Step by step process of incorporating a US company from Poland
- Getting a Registered Agent in the US
- “Delaware Flip” - transferring your Polish business entity into a US one
- Everything you need to know about taxes, work visas, and hiring
So without further ado, let's dive in.
- If you're looking to raise cash for your business, forming a US company will enable you to do so from the greatest startup capital market in the world: the United States.
- A US address is not necessary to form a Delaware company, but you will need to find a registered agent in the state.
- Working in Poland won't impact your personal tax status (because your company will still be responsible for paying taxes to the IRS in the United States), and you won't need a work visa.
- You will need to use a Polish subsidiary or utilize an EOR provider like Deel if your US company wants to employ Polish workers.
How do I register a US company from Poland
If you're in Poland and want to start a corporation in the United States, these are the six steps you need to take:
- Select an entity type. There is a widespread belief that businesses that want to raise money from angel investors and VC firms should incorporate as C Corporations rather than LLCs. Check C Corporation or LLC: Which is the best entity for your startup to learn more. If you want to provide stock to employees, advisors, and other stakeholders, forming a limited liability company (LLC) may not be the best option since it makes it more difficult to attract investors. Limited liability company (LLC) cannot issue shares of stock, therefore, this cake will be very difficult to distribute among investors. In addition, the decision to enter a given startup proceeds relatively quickly, and investors do not have the time or inclination to go through time-consuming legal and financial due diligence, which contains many unknowns resulting from foreign law unknown to investors.
- Decide where to incorporate your business. The best option is to form a Delaware C Corporation. The bulk of tech startups and over seventy percent of the Fortune 1000 are headquartered in the state of Delaware. Why? Due to the state's favorable legal and tax climate, investors are used to dealing with Delaware corporations. Read more about Why startups incorporate in Delaware instead of other US states.
- File the articles of incorporation. Capbase makes this very easy, and the process of filing to incorporate your US company should take about ten minutes. The cost is included in Capbase’s annual subscription payment.
- Get an employer identification number (EIN) from the Internal Revenue Service (IRS). This will be needed in order for you to be able to open a US bank account. Registering with the IRS also authorizes your company to pay taxes. (Capbase obtains an EIN on your behalf.) For more information on how to obtain your EIN, check out our article on this topic.
- Open a bank account in the United States. It's impossible to do business in the US without a US bank account. With your EIN in hand, you'll be able to create a bank account. (Capbase works with a number of US banks that specialize in working with startups, including Mercury.)
- File reports to maintain your business's good standing. Delaware requires annual reporting, which is due on March 1st every year. (Tip: Capbase's built-in capabilities make it easy to meet all of your filing deadlines.)
How to get a US registered agent
Having a registered agent in the United States is required even if you don't reside there. One of the responsibilities of a registered agent is to accept legal documents and other communications on behalf of a firm. If you need to send formal correspondence to them, they have a real, physical location in the state where you file your paperwork.
- Notices of compliance regarding reporting or other requirements
- Revenue or tax department documents from the state
- Process services (notices of lawsuits against your company)
- The address of your registered agent can not be the same as the legal address of your corporation. Your legal address in Poland must be your own.
Tip: When you use Capbase to incorporate your company in Delaware, Capbase acts as your registered agent.
How to move an existing company to the US from Poland
If your firm is already formed in Poland, you may utilize the "Delaware Flip" to successfully move the Polish corporation to the United States. (Read our article on the "Delaware Flip" for further background.)
Existing companies of any size may register in Delaware, although it's simplest to do so when they have few shareholders. To put it another way, it is preferable to begin with a Delaware C Corporation. However, if you’re going to convert your Polish company over to a US corporation, it’s best to do this sooner rather than later.
The process of forming a C Corporation in Delaware requires the selection of a suitable business name. It's possible that the name you choose for your Polish firm is already in use; if so, you'll need to come up with a new one before you can register in Delaware.
To finalize the Delaware flip you establish a Delaware C Corporation, acquire the Polish firm to turn it into a subsidiary.
Step by step:
- Make use of Polish accountants and attorneys to guarantee your business meets all legal requirements. Any outstanding debt or equity must also be settled. You should consult the proposed action to a tax advisor as the exit tax may occur in Poland. The exit tax refers to situations in which a taxpayer changes the tax residence or transfers an asset abroad, which results in Poland losing its right to tax income from the sale of such assets, therefore, the best thing you could do is to take an interest in registering a company in the USA from the very beginning.
- Create a C-Corporation in the state of Delaware. It also involves assigning roles and distributing stock. The incorporation process may be completed in just 10 minutes with the help of Capbase.
- Your Polish business's shareholders have to approve the plan to convert their firm into a subsidiary of your new US corporation in exchange for cash, shares, and intellectual property. This calls for a buyback of the shares
- A yearly report must be sent to the Delaware Secretary of State after incorporation. Furthermore, each year, a company must submit an IRS tax return.
US tax and visas for Polish entrepreneurs
You may maintain your personal tax resident status even if you establish a company in the United States. As your US company is subject to US taxation, your corporation will file its own tax returns. As a Polish citizen or resident, you must keep up with your Polish tax obligations.
Forming a company in the US does not require you to hold a visa or have residency. Nonetheless, you will need one if you plan on relocating to the United States in order to manage your company. Although forming a company in the United States as a foreign national does not automatically qualify you for a green card or other kind of permanent residency, some visas are made accessible to company founders and individuals doing business in the United States. Polish nationals may apply for several different types of work visas, including the E-1, E-2, EB-5, L-1, and O-1.
More information can be found in our comprehensive guide to US immigration visas for startup founders. You should seek legal advice from an immigration attorney or specialized immigration service such as LegalPad if you are considering applying for a business visa or green card to emigrate from Poland to the USA.
Hiring Polish employees for your US corporation
After forming your Delaware C Corporation, you are not required to employ the residents of the United States. It is possible to recruit people in Poland, but you will need to take certain additional measures.
In order to hire Polish employees, you may do one of two things:
- Use a Polish company to hire locally and make it a subsidiary of your Delaware C Corporation.If you focus your research and development activities in Poland, the Polish subsidiary could take advantage of tax reliefs, as well as your employees benefiting from higher tax-deductible costs.
- Set up a cloud-based payroll and regulatory compliance system, such as Deel. You may find and recruit foreign nationals to fill permanent or temporary positions in your company. If the former, then Deel will engage the worker on your behalf as the employer-of-record (EOR).
Attention: Capbase users get 30% off their first year with Deel.
Curious about how Deel might help your company connect with the best talent across the world? Learn more about the Deel, and listen to our podcast with one of its founders Shuo Wang.