01Legalization of IT specialists' work in Poland
There are two main paths for legalizing the work of IT specialists in Poland:
The first is for specialists who are thinking about moving to Poland and planning to find a job, and the second is for those who already have a client and need to legalize their cooperation with them.
How to set up your work in Poland?
We can consider three main options for setting up your professional activity in Poland:
· Employment contract (Umowa o pracę);
· B2B contract;
· Working through a business incubator.
Now let's break down each of these options and determine which one suits you best.
Employment contract or B2B contract?
Scenario 1:
You already have an employer with whom you can work under an employment contract or a B2B contract.
An employment contract is a full-fledged document that protects the rights and obligations of an employee. By signing an umowa o pracę, you fall under the Labor Code: pension contributions are accrued to you and paid vacation is guaranteed.
Incomes in the IT sector are generally higher than the national average, so you can easily apply for a Blue Card — we have covered this topic in detail in our blog. In a nutshell, if you get a Blue Card, you are considered a highly qualified specialist in the eyes of European legislation. In the future, if you want to move to another country, it will be easier for you to legalize your stay there, and your time spent in Poland will count towards the required period for obtaining an EU long-term resident card. Simply put, the Blue Card gives an IT specialist a great opportunity to kick-start their European life.
If you decide to work on a B2B contract, it will be more tax-efficient for you, as you will only pay ZUS and income tax, unlike an employment contract where taxes can take up about 60% of the net amount. In the case of sole proprietorship (JDG), VAT simply gets covered by the client.
If you want the protection of the Labor Code and the opportunity to obtain a Blue Card, choose an employment contract. If you want to optimize your taxes to earn more, go ahead and choose a JDG. But remember, not everyone is eligible to register a sole proprietorship.
Moving on to Scenario 2: When you already have a client who is not located in Poland. Opening a JDG is an appropriate solution in this case. In the eyes of the law, you are an entrepreneur who works with a foreign company, provides services to them under a contract, issues invoices, and pays taxes. Please note, however, that not every foreigner in Poland can open a JDG. In the case of IT specialists, JDGs are most often opened by:
· Citizens of Ukraine;
· PBH visa holders;
· Holders of the Karta Polaka or permanent residence (pobyt stały);
· Those who received a residence card based on family reunification (pobyt z cudzoziemcem).
What should specialists do if they don't have the option to open a JDG? In this case, you can consider a business incubator.
Working through a business incubator
A business incubator is a company that gives you the opportunity to conduct your activities on their behalf. Simply put, on paper you are an employee of a specific company and perform work for them. Most often, an umowa o dzieło is concluded, which offers a tax-efficient process. The catch is that with this type of contract, the scope of work must be "one-off". Suppose you receive an order to develop software. You complete the work, transfer the copyrights to this software, and move on.
If you perform a certain amount of work on a regular basis, then an umowa zlecenie or umowa o pracę will suit you better. Although, as practice shows, umowa zlecenie doesn't make much sense for IT specialists, as there is no significant tax difference compared to an employment contract. Except perhaps for full-time students under 26 years of age.
So, to sum it up:
We choose an employment contract when we want to be employees of a specific company and have all the privileges granted to us by the Labor Code.
Useful materials:
How to change jobs if you have already received a karta pobytu?
BUSINESS AND RESIDENCE PERMIT IN POLAND. How to run a business to get a karta pobytu?
International truck drivers – legal stay and work in the EU.
3 reasons why you shouldn't delay applying for a karta pobytu after arriving in Poland.
Permanent residence in Poland: EU resident card - How to get it? Detailed guide.
Karta pobytu based on work or family reunification? Which to choose? Full breakdown.
TOP 5 cases when a karta pobytu can truly be independent of the employer
Refusal of a karta pobytu: reasons people don't like to talk about (undesirable stay, SIS) - Solutions to the problem
Permanent residence in Poland without a Karta Polaka: the complete process of obtaining a pobyt stały permit based on ancestry.
Family reunification in Poland - everything about the karta pobytu for a spouse and children.
Pobyt stały: Permanent residence in Poland with a Karta Polaka - application and financial support.
Blue Card in Poland - everything about the karta pobytu and residence permit for highly qualified professionals.
