Closing of the accounting books and tax year during the liquidation of the LLC in Poland

The opening of the liquidation of a Polish limited liability company results in the need to close and reopen the accounting books and close the tax year and open a new one.

This usually results in two financial statements and two annual tax returns.

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Reverse vesting in Venture Capital transactions in Poland

Polish law allows the use of reverse vesting clauses, involving the use of call options to repurchase shares from the founder in the event that he or she wishes to leave the company before the end of the agreed period.

The number of shares that can be repurchased in this way usually decreases over time.

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Venture Capital transactions in Poland and liquidation preference

In investments made by Venture Capital funds in Poland, it is common practice to introduce the so-called liquidation preference for the VC fund.

In case of a liquidity event (e.g., sale of shares or liquidation of the company), the VC fund first receives funds to recover its investment.

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Damages are not subject to VAT in Poland

Damages (odszkodowanie) for improper performance of contracts should be treated in Poland as an activity not subject to VAT.

On the other hand, for a performance to be considered a VAT-taxable service, there must be a direct relationship between the performance and the payment and exchange of mutual benefits.

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Enforcement of judgments and court settlements from EU countries in Poland

Judgments and court settlements from European Union countries can be relatively easily enforced in Poland under the provisions of the so-called Brussels I Recast Regulations (1215/2012).

A Polish bailiff will enforce a judgment or court settlement on the basis of a standard certificate issued by the court of the country where the judgment was issued (or the settlement approved).

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Family Foundations in Poland

The Polish Parliament works on a law on family foundations. New in Polish law, the institution of a family foundation is expected to improve the legal environment for the succession of family businesses.

Family businesses make up a large portion of Polish companies established in Poland over the past 30 years, and the new legislation aims to facilitate succession and the continued smooth operation of family businesses, without the need for foreign legal solutions.

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