Shopify without a company - Do you need a company to sell?
01/03/2024
08:00 min
Bartosz Lewandowski
Shopify without a company - Do you need a company to sell?
01/03/2024
08:00 min
Bartosz Lewandowski
Table of Contents:
- Legal regulations in Poland
- Unregistered business activity in an online store
- Shopify and the Polish legal reality
- Advantages and disadvantages of selling without a registered company
- What can be sold on Shopify without a business in Poland?
The development of technology and the shift of a significant portion of commerce to the virtual world have opened unprecedented opportunities for entrepreneurs and individual sellers. One platform gaining popularity in Poland is Shopify - an e-commerce solution that facilitates the creation of one's own online store, even for those without deep technical knowledge. As a result, more and more people are wondering whether it is necessary to formally register a business to start selling online.
Online commerce seems to be a promising direction both for existing companies and for budding entrepreneurs seeking their niche in the market. In both cases, Shopify offers a simple tool to create a store, present products, and manage orders. Many are also attracted by the prospect of running a business from anywhere in the world, which aligns with the growing expectations of flexible work and lifestyle.
However, when starting an online selling venture, one cannot overlook the legal aspects and regulations that define the framework for conducting online business in Poland. Common questions about the possibility of selling without formal business registration gain importance in the context of applicable legal regulations and the necessity to comply with them.
Does everyone dreaming of opening a Shopify store have to go through the process of company registration? What are the legal and tax consequences of selling without a formally registered business? What conditions must be met to operate in compliance with regulations while minimizing formalities? I will try to answer these and other questions in this blog post, aiming to dispel any doubts and enable you to make an informed decision about starting or developing e-commerce activities on the Shopify platform.
Legal regulations in Poland
In Poland, as in many other countries, online sales are regulated by laws that define the rules for conducting such activities. Regardless of the chosen sales platform, such as Shopify, it is important for every seller to be aware of the applicable legal requirements.
Forms of business activity
According to Polish law, an online store can operate in various legal forms. These include sole proprietorship, civil partnership, limited liability company, and others. However, a partnership is reserved for practicing free professions and cannot be used for conducting online trading activities. The choice of legal form significantly impacts the tax and accounting aspects of the business.
Online store regulations
Every online store in Poland must have regulations. This document defines the terms of use of the store, as well as the rights and obligations of both the seller and the buyer. The regulations should include, among other things, information about the types and scope of services provided, conditions for concluding and terminating contracts, complaint procedures, and delivery costs.
Right to withdraw from the Contract
Consumers have the right to withdraw from a distance contract within 14 days without giving any reason. Sellers are obliged to inform buyers about this right in the store's regulations. However, there are exceptions to this right, for example, in the case of goods made to individual order.
Personal data protection
The issue of protecting customers' personal data cannot be overlooked, which is of particular importance nowadays. According to GDPR (General Data Protection Regulation), any store that processes personal data must implement appropriate security measures and inform customers about the method and purpose of processing their data.
Sales within the European Union
When conducting sales on an international scale, it should be noted that sales within the European Union are allowed provided that the products have been legally placed on the market in one of the member countries. This opens up additional opportunities for Polish sellers but also involves additional obligations, such as ensuring product compliance with EU requirements.
Starting an e-commerce business in Poland, even on a flexible platform like Shopify, requires a thorough understanding of the applicable legal regulations and compliance with them. This will not only help avoid potential legal issues but also provide a solid foundation for building customer trust and satisfaction.
Remember to discuss all legal aspects of your online store with a lawyer. The above information is merely guidelines to be aware of when running a Shopify store.
Unregistered business activity in an online store
Dreaming of your own online business, but the vision of bureaucratic complexities and company registration makes your head spin? Or maybe your sales plans are occasional, or you want to test your concept first? Unregistered business activity in an online store may be the perfect solution!
What is unregistered business activity?
Business activity usually involves continuous and organized earning on one's own account. Unregistered business activity is similar but does not require official registration in CEIDG and has limitations on the amount of profits.
Conditions for conducting unregistered business activity
- Who can conduct it: Only individuals without shares in companies.
- Revenue limit: You cannot exceed 75% of the minimum national wage per month. (These figures may change. Always verify such information.)
- Break in conducting business: You cannot have registered business activity in the last 60 months.
When must you register a business?
You must register a business if your activity:
- Requires a permit or license.
- Is defined as business activity under the law.
- Exceeds the revenue limit for unregistered business activity.
Benefits of unregistered business activity
- No need for registration in CEIDG.
- Avoidance of paying VAT and tax advances.
- Ease of combining with full-time work.
Obligations within unregistered business activity
- Filing an annual PIT-36 tax return.
- Keeping simplified sales records.
- Registering a company if you exceed the revenue limit.
Opening an online store within the framework of unregistered business activity gives you the chance to try your hand at e-business without commitments and complicated bureaucracy. It's a perfect opportunity to turn your passions and skills into a profitable project.
Shopify and the Polish legal reality
Shopify is a global e-commerce platform that allows users to create and manage online stores without the need for advanced technical skills. From the perspective of the Polish legal reality, Shopify provides tools for sales but does not exempt sellers from the obligation to comply with local regulations.
Although Shopify operates in many countries, each seller on this platform must adapt their store to the regulations in their jurisdiction. In Poland, this means, among other things, the need to prepare store regulations in accordance with local law and consumer protection rules.
Data protection requirements
Stores operating on Shopify and targeting customers from Poland must also comply with the EU General Data Protection Regulation (GDPR). This means, among other things, the need to provide an appropriate privacy policy, inform customers about the methods and purposes of data processing, and implement procedures that allow users to exercise their rights (e.g., the right to data deletion).
Compliance with consumer law
Polish consumer law aims to protect buyers from unfair sales practices. Sellers on Shopify must ensure that their sales processes - from product presentation, through the purchase process, to complaint and return handling - comply with applicable regulations. This particularly applies to information about the right to withdraw from the contract, warranties, and complaint procedures.
Integrating the Shopify platform with the Polish legal system requires a thorough analysis of applicable regulations and adapting the trading activities to local requirements. Although Shopify offers vast possibilities in terms of e-commerce, it is the entrepreneur's responsibility to ensure that their online store meets all Polish legal, tax, consumer, and data protection standards. This is important not only from the perspective of avoiding sanctions but also building trust among customers.
Advantages and disadvantages of selling without a registered company
While selling without a company on Shopify may seem like an attractive option for those starting to sell on e-commerce platforms, it is important to understand both the advantages and disadvantages of this solution.
Advantages
- Minimization of formalities: By opting for unregistered business activity, you avoid many administrative obligations, such as registration in CEIDG (Central Register and Information on Economic Activity) or reporting activity to ZUS (Social Insurance Institution).
- Financial savings: You do not incur costs related to ZUS contribution fees, which can be a significant burden for newly registered businesses, especially in the initial period of activity.
- Simpler taxation system: Income from unregistered business activity is settled once a year using an annual tax return. This allows for simpler accounting and record-keeping.
- Testing a business idea: It's an excellent option for those who want to test their business idea online without obligations to the tax office or social security, with limited legal and financial liability.
Disadvantages
- Limited revenue: Conducting unregistered business activity is possible only up to a certain revenue limit. If this threshold is exceeded, formal business registration is required.
- Limited credit opportunities: Unregistered business activity may be perceived by banks and other financial institutions as less credible, which may hinder obtaining financing.
- Personal liability: Conducting unregistered business activity means you are personally liable for its obligations with all your personal assets, not just assets allocated for business purposes.
- Limited capacity for expansion: In the case of wanting to expand activities, such as foreign trade, unregistered business activity may encounter regulatory and practical barriers, forcing formal business registration.
Both the advantages and disadvantages of conducting business without a registered company in Poland should be carefully considered before deciding to start selling, especially on a platform like Shopify. For many, especially in the early stages of activity, it can be an excellent option to test their business idea with minimal costs and formalities. However, as the business grows, it is worth considering formal registration to secure its future and enable further development.
What can be sold on Shopify without a business in Poland?
In Poland, unregistered business activity, regardless of whether products are sold locally or using an e-commerce platform like Shopify, allows for the trade of most goods and services that are legally permitted, under certain conditions. Below are key aspects to consider when deciding to sell online without a formally registered company.
Products that can be sold
- Handmade products: All handicrafts and products made by hand, such as jewelry, decorations, clothing, or furniture.
- Digital products: For example, e-books, online courses, software, digital photographs, music files, etc., which do not require physical shipping.
- Household items: Clothing, footwear, accessories, home appliances, tools, etc., as long as they are not intended for specialized use that would require special permits.
- Books and other educational materials: However, this does not include publications containing content prohibited by law.
- Collecting orders for custom products: For example, personalized products created on special order from the customer.
Restrictions and exceptions:
However, there are exceptions and restrictions regarding items that cannot be freely sold on Shopify:
- Regulated products: Medicines, plant protection products, chemicals, dietary supplements - the sale of these products is regulated by additional laws and may require permits.
- Alcohol and tobacco products: Sale requires a license; online sales of these products are strictly regulated or prohibited.
- Food: Trading food, especially fresh or requiring specific storage conditions, may require meeting additional sanitary requirements.
- Cars, car parts, and other motor vehicles, including recreational vehicles (RV), all-terrain vehicles (ATV), and motorcycles.
- Cannabis products.
- Drugs and derivatives.
- Financial or specialized services.
- Hazardous materials.
- Adult content.
- Medical devices and accessories.
- Surveillance equipment.
- Weapons.
The vast majority of goods can be sold online without formal business registration, as long as you do not exceed the established revenue limit for unregistered business activity. However, it is important to learn about all applicable regulations regarding the specific type of products before starting sales and remember that our activity is subject to income restrictions. Regardless of the content provided, it is important to remember legal obligations, such as customer data protection (GDPR), store regulations, consumer information obligations, and proper tax settlement.
For more product inspiration, check out our post: "What Can Be Sold on Shopify?"
Summary
In summary, the decision to sell on Shopify without having a formally registered company in Poland can open up many opportunities for budding entrepreneurs. Whether we are talking about small-scale handicraft activities, the sale of digital products, or other goods permissible for sale within unregistered business activity, there are several benefits, such as minimizing formalities and financial savings related to ZUS fees.
However, making such a decision also requires awareness of applicable restrictions and responsibilities. Exceeding the revenue limit, the need to comply with specific regulations regarding certain product categories, or the obligation to ensure compliance with data protection regulations are just some of the challenges that may arise.
Proper preparation of store regulations, gaining knowledge about consumer rights to withdraw from the contract, as well as proper understanding and application of GDPR regulations are basic steps to take before starting sales. The solutions offered by Shopify allow for the realization of these aspects, although it is important to remember that the legal responsibility for conducting business in compliance with Polish law rests with the seller.
It is worth emphasizing that the information presented may change as legal regulations and market practices evolve. Law, especially in the field of e-commerce, is a dynamically developing area, which may lead to updates of regulations regarding conducting online trading activities. Therefore, to ensure that your business is conducted in accordance with the latest legal standards and tailored to your individual situation, I strongly encourage consulting with an experienced lawyer specializing in commercial law or digital market law.
As the author of this post, I would like to emphasize that I am not a lawyer, and the information presented in the text should be treated as general guidelines, not professional legal advice. Every business situation is unique and may require a more detailed legal analysis. Contacting a qualified specialist can help clarify any doubts and ensure that your business starts on solid, legally safe foundations.
Frequently Asked Questions
- Can I sell on Shopify without registering a business in Poland? - Yes, you can start selling on Shopify without formally registering a business, provided your revenues do not exceed the established limit for unregistered business activity. However, remember that certain restrictions and legal responsibilities apply.
- What are the main requirements to run a store on Shopify in Poland? - To run a store on Shopify in Poland, you must develop store regulations compliant with Polish law, ensure a privacy policy, and comply with consumer regulations, including informing customers about the right to withdraw from the contract. You must also be prepared to maintain GDPR compliance.
- Can I issue invoices to customers when selling on Shopify without a registered company? - Yes, you can issue invoices to customers, although you are not obliged to do so when conducting unregistered business activity. However, at the customer's request, you should be able to provide a document confirming the purchase.
- What happens if I exceed the revenue limit for unregistered business activity? - If you exceed the revenue limit for unregistered business activity, you will be required to formally register a business in Poland and meet all related legal requirements, including reporting to ZUS and tax settlements.
- Do I need to ensure my activities comply with GDPR? - Yes, regardless of the form of business, if you process customers' personal data (which is unavoidable in online sales), you must ensure compliance with GDPR regulations. This includes preparing an appropriate privacy policy, informing customers about the methods and purposes of processing their data, and providing them with the ability to exercise their rights.
Bartosz Lewandowski
CEO
Newsletter
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