Crypto Business Registration in Poland: Help with the New Requirements

On November 1, 2021, amendments to the Act on Combating Money Laundering and the Financing of Terrorism (the New AML Act) came into force in Poland. The restated document clarified the status of cryptocurrencies and cryptocurrency trading. 

Mining, sales, and purchase of crypto instruments became a  regulated field of business in Poland. The Law stipulates mandatory registration of cryptocurrency companies with the Polish Cryptocurrency business Register (Rejestr walut wirtualnych). 

The operating companies need to do so within 6 months, the new startups must register before they launch any cryptocurrency activity. 

Who is required to register with the Cryptocurrency business register in Poland

Article 12(1)(2) of the new Polish AML Act prescribes registration of all crypto companies, i.e., those rendering services related to cryptocurrency exchange:

• exchange between virtual currencies and fiat money
• exchange between virtual currencies
• intermediacy in the virtual currency exchange 
• custodian wallets.

Main requirements for crypto companies in Poland 

To register a сrypto business in Poland, the owner, company manager, or proprietor need to meet the following criteria:

1. clean criminal record – no prior convictions for an intentional crime against public institutions and local government, against the administration of justice, against the credibility of documents, against property, against economic turnover and property interests in civil law transactions, against money and securities trading, or any offense committed for material or personal gain or an intentional fiscal offense;
2. at least 1 year of relevant experience and knowledge of operations with cryptocurrency and virtual assets.

The second requirement means that the person needs to prove the successful completion of some training courses covering legal and business aspects of virtual currencies. The relevant experience can also be confirmed by certificates, diplomas, letters of recommendation from the employer. However, the Law does not specify the eligibility criteria by which the registering authority will acknowledge such documents.

The above requirements apply to sole proprietors and, in the case of companies, managing directors.

Crypto business registration process in Poland

The entity going to start a crypto business in Poland can be in any legal form. However, the registration with the Cryptocurrency business Register is mandatory for all proprietors and entities engaged in cryptocurrency activities.

The registration with the Rejestr walut wirtualnych involves the following steps: preparation of documents, acquisition of the PESEL tax identification number and ePUAP portal account, application to the Register.

Paperwork 

• prepare documents for the online application 
• obtain electronic signatures (Trusted Profile) of the founder and the director (they can do this remotely at the Polish consulate) 
• pay the state fees for the registration of the legal entity
• fill out the declarations for the Tax Office and the Register of Beneficiaries
• rent a legal address and a post office box for 1 year.

PESEL tax identification number and ePUAP portal account

With your PESEL tax identification number, you will be able to apply for the Cryptocurrency business registration online (and handle all other formal matters) through the state-run ePUAP portal. 

To obtain the PESEL number remotely, you need to submit a legally authenticated copy of your passport together with its Polish sworn translation executed in Poland (Please note that it needs to be apostilled if certified by a foreign notary, not a Polish consulate). 

This service takes up to 30 days from the receipt of the original copies and legal translations. You can obtain the PESEL number in 1 day if you apply in person in Poland.

Then you will need to make an appointment at the Polish consulate – to activate your account at the ePUAP portal. To do so, you will be asked to present your passport and proof of your PESEL number. Upon activation, you can submit the electronic application to the Cryptocurrency business Register.

Application for registration in the Cryptocurrency business Register

Your application for the registration with the Registry will be processed within 14 days after signing the application on the ePUAP portal. If the Registry requests some extra information, this deadline can be extended by another 14 days from the date the Registry sends an e-letter to your ePUAP account.

After the entry is made, the ‘pending’ status of your registration will change for ‘completed’, and you will be able to launch your virtual currency services.

Taxation of crypto business in Poland

Crypto business in Poland is taxable. Every cryptocurrency company is subject to the following fiscal obligations:

•  CIT 9% or 19%, (CIT 9% if sales do not exceed the equivalent of 2 million EUR in the current year, if higher, the tax will be 19%)
• VAT 23% – basic rate
• PIT 17%, 19%, 32%, depending on the form of taxation and profit in the financial year
• Dividend TAX 19% – only for residents, while the rate for non-residents depends on the Tax Treaties
• Withholding tax – 0% – 20%.

When planning the registration of a crypto business in Poland, please consider the mandatory requirements for accounting and filing of tax returns:

• VAT monthly or quarterly
• CIT filing once a year 
• advance tax payments monthly or quarterly.

Penalties and restrictions for certain cryptocurrency transactions

A fine of PLN 100,000 (~$25,000) is levied for the failure to register a company with the virtual currency registry in Poland.

Besides the updated requirements for crypto business registration, there is also a new KYC (“know your customer”) threshold for cryptocurrency transactions. Previously, the minimum threshold was EUR 15,000. From 31.10.2021, customers must be identified in case of transactions exceeding EUR 1,000. This change will mainly affect crypto ATMs. Currently, anonymous withdrawals are allowed only for amounts up to EUR 1,000.

If you are interested in registering a cryptocurrency company and starting a crypto business in Poland, either in person or remotely, you can rely on our expertise and services. Please get in touch with us by e-mail or in messengers given at the top of this page. We will help you register a cryptocurrency business in Poland tailored to your needs, in full compliance with the Law, confidentially, efficiently, professionally.