Company in the Cayman Islands for $2,500. Full discretion, zero taxes, registration in 48 hours. Sound tempting?
In 2025, the truth about offshore companies is quite different from the promises of registration companies. It’s not a question of morality – it’s pure economics, law and practicalities. For 95% of Polish entrepreneurs, offshore is a road to nowhere, full of costs, complications and unexpected legal problems.
We explain why most offshore structures do not work for the typical business – and what the real alternatives are.
Attempts to exploit ‘loopholes’ usually end in cost, stress and legal problems. An honest, transparent business with a well-considered and legitimate structure is a recipe for peace of mind.
Offshore Companies: When They Make Sense
and When They’re Just an Illusion of Privacy
Paweł is forty-seven and owns a marketing agency in Warsaw. He’s sitting at his laptop, browsing offerings from firms that specialize in registering offshore companies. “Company in the Caymans for twenty-five hundred dollars. Complete discretion, zero taxes, registration in forty-eight hours.” It sounds tempting. Paweł is at odds with the Polish tax office—a protracted dispute over the interpretation of deductible expenses. He thinks: maybe I’ll move part of the operation abroad, maybe that will simplify everything.
Then there’s Michał, thirty-one, a freelance programmer earning mainly in dollars from American clients. He’s read that a Delaware company can be “anonymous,” that you can avoid Polish bureaucracy, that international payments will be easier. “After all, I’m not doing anything wrong,” he thinks. “I just want to work normally without excessive state control.”
Both share a similar assumption: that establishing an offshore company is a matter of filling out a form, paying a fee, and you’re done—an independent business structure outside the Polish tax system.
The problem is, that assumption is fundamentally wrong.
The truth about offshore companies in 2025 is far more complicated, expensive, and—for most Polish entrepreneurs—entirely impractical. This isn’t a question of morality or good or bad intentions. It’s pure economics, law, and practical operational realities.
Offshore companies: examples
Let’s start by demystifying the term. An “offshore company” isn’t any special legal construction. It’s simply a company registered in a jurisdiction other than where you actually conduct business. For a Polish entrepreneur, every company registered outside Poland is technically “offshore.”
When we talk about “tax havens” or “offshore,” though, we mean something more specific: jurisdictions that deliberately design their laws to attract international capital through favorable taxation, ownership discretion, or both.
The list is long and varied. The British Virgin Islands, where more companies are registered than there are residents. The Caymans, home to hedge funds managing trillions of dollars. Delaware, where half of America’s publicly traded companies maintain their legal domicile despite conducting no actual business there. Panama, the Seychelles, the Marshall Islands, Belize. Each jurisdiction offers something slightly different—zero income tax, absence of public ownership registries, fast and cheap registration, or all of the above.
But the fact that you can establish a company there doesn’t mean you can sensibly conduct business there. And it certainly doesn’t mean you can avoid Polish taxes.
Why Paweł Won’t Escape Polish Taxes
Let’s return to Paweł and his marketing agency. Suppose he actually establishes a company in the Caymans. Registration genuinely takes forty-eight hours. Fees? Around twenty-five hundred dollars, plus annual fees for a registered agent on the order of a thousand dollars a year. The Caymans have no income tax, so formally the company pays no taxes there. Sounds great.
The problem emerges when Paweł tries to actually use this structure.
The Polish tax system operates on the concept of corporate tax residency. A Polish company—meaning a company with its seat or management in Polish territory—is subject to taxation on all its income, regardless of where that income originates. But it works the other way, too: a foreign company can become a Polish tax resident if it has its “place of effective management” in Poland.
What does this mean in practice? The Polish tax authorities look at where key management decisions are made. Where board meetings occur. Where the person actually managing the company resides. Where accounting documents are kept. Where actual business operations are conducted.
Paweł sits in Warsaw. He manages the company from Warsaw. He meets clients in Warsaw. He employs workers in Poland. The servers are in Poland. A Polish accounting firm handles the books. Invoices are issued from Poland. The only thing connecting his business to the Caymans is a slip of paper with a certificate of incorporation.
The Polish tax office will say in such a situation: this is a Polish company. It has its management seat in Poland, its place of effective management in Poland, conducts business in Poland. It will be taxed in Poland on all its income, at the standard corporate-tax rate. The fact that it’s formally registered in the Caymans is irrelevant.
What’s more, there’s the problem of C.F.C. regulations—Controlled Foreign Company. The provisions on controlled foreign companies, introduced into the Polish corporate-tax law, state explicitly: if a Polish tax resident (individual or legal entity) controls a foreign company, and that company earns certain types of passive income (dividends, interest, royalties) or operates in a so-called low-tax zone, that foreign company’s income is taxed directly in Poland—even if it hasn’t been distributed as a dividend.
For Paweł, this means not only that his entire Cayman company may be subject to Polish corporate tax but also—if he somehow manages to convince the tax authorities that the Cayman company isn’t actually a Polish resident—he’ll be covered by C.F.C. regulations, which will tax that income in Poland anyway.
The more Paweł tries to “use” his Cayman company to conduct real business, the more certain it becomes that the Polish tax authorities will consider it a Polish resident. And the more he keeps it as an “empty” structure without actual operations, the less business sense it makes—and, additionally, he exposes himself to tax on shell companies, a specific form of C.F.C. tax.
Why Michał Can’t Open a Bank Account
Michał, the freelance programmer, has a different problem. He’s established a company in Delaware—one of the American states offering simple L.L.C. registration without public disclosure of owners. Minimal costs, registration in two days, sounds ideal.
Now Michał wants to open a bank account for his company. After all, he needs somewhere to receive payments from clients.
And here the problem begins.
Michał applies to an American bank. The bank requires documentation. Certificate of incorporation—check. E.I.N. (tax-identification number)—obtainable. But then the bank wants something more. It wants to know the beneficial owners—the real owners. It wants their passports. It wants proof of address. It wants to know where the funds flowing into the account will come from. It wants a business plan, description of activities, list of main clients.
The bank applies K.Y.C. procedures—Know Your Customer—which are a legal requirement in every civilized jurisdiction. American banks are particularly cautious, because they face enormous penalties for violations of A.M.L. (anti-money-laundering) regulations. We’re talking about hundreds of millions, sometimes billions of dollars in fines.
Michał fills out forms. Sends documents. Waits. After two weeks, he receives a brief response: “Thank you for your interest, but at this time we cannot open an account for your company.”
No explanation. This is standard. Banks rarely explain reasons for rejection, because sometimes the law forbids it (in cases of money-laundering suspicion, the bank cannot notify the client that it has filed a S.A.R.—Suspicious Activity Report).
Michał tries another bank. Same result. He tries a third. Rejected.
The problem is structural. A company registered in Delaware whose owner lives in Poland, whose clients are in America, which has no physical office or employees in the U.S., which lacks “substance”—real economic substance in the place of registration—is a red flag for every compliance officer in every bank.
Banks practice something called “de-risking”—systematically closing or refusing service to entire categories of customers deemed high-risk. Offshore companies are at the top of that list. Banks would rather lose potential revenue than risk multimillion-dollar regulatory penalties.
Michał finally tries a fintech—one of the modern payment platforms. Wise, Payoneer, maybe Revolut Business. But here, too, he encounters the same requirements. Beneficial-ownership disclosure. Proof of business activity. Source of funds.
After a month of frustration, Michał finally opens an account. Not with an American bank but with one of the smaller E.M.I.s (Electronic Money Institutions) operating in a gray zone. High fees, low limits, terrible customer service. After six months, the E.M.I. closes his account without warning, claiming it detected “unusual transaction patterns.”
The funds are frozen. Michał has to wait three months for their return. Meanwhile, one of his main clients, not receiving payment, cancelled the contract.
The More “Anonymous” the Company, the More Visible to Authorities
There’s something deeply ironic about the entire construction of offshore companies. People establishing them often do so believing they’ll increase their privacy, reduce visibility to authorities, avoid excessive state control.
Reality is exactly the opposite.
Every attempt at a transaction using an offshore company automatically raises flags in the compliance systems of every financial institution. FATF—the Financial Action Task Force, an international organization setting standards for combating money laundering—explicitly lists “use of anonymous entities or shell companies” as one of the ten primary indicators of suspicious activity.
What does this mean practically? That every bank, every payment processor, every broker, every cryptocurrency exchange, every notary, every lawyer, every accountant—all these professionals acting as “obliged entities” in the A.M.L. system—are required to apply Enhanced Due Diligence to clients using offshore structures.
Enhanced Due Diligence isn’t ordinary verification. It’s a process many times more invasive and time-consuming than standard K.Y.C. The bank requires not just identification of the owner but a complete history of the source of wealth—where the money came from, how it was earned, over how many years, from what activities. It requires a detailed business plan, client lists, contracts with counterparties. It requires an explanation of why an offshore structure was used instead of an ordinary local company. Every transaction is monitored. Every larger deposit requires explanation.
What’s more, professionals serving such clients are obligated to report “suspicious activity” to local F.I.U.s (Financial Intelligence Units)—agencies dealing with combating money laundering. In the U.S., it’s a S.A.R.—Suspicious Activity Report. In Poland, it’s GIIF—the General Inspector of Financial Information.
You don’t need to commit any crime for such a report to be filed. It’s enough that the structure seems unusual, unjustified from a business standpoint, disproportionately complicated relative to the scale of operations. The mere fact of using a Delaware company to conduct solo freelance work can be sufficient reason.
And here’s the worst part: the person the S.A.R. concerns cannot be informed about it. It’s a crime for anyone to tell you they’ve filed a report of suspicious activity about you. It’s called “tipping off,” and it’s punishable.
So not only do you not gain privacy—you actually lose it. Instead of being an ordinary entrepreneur running a transparent, local business, you become a “person of interest” in law-enforcement databases, despite having committed no crime.
When Offshore Companies Make Sense
A Very Narrow Range
After all this, a question arises: are there any situations where an offshore company makes sense for a Polish entrepreneur?
The answer is yes, but the range is very narrow and concerns very specific situations.
International Holding Structures for Large Capital Groups
If you manage an international capital group with operations in many countries, a holding company in a neutral jurisdiction can make sense as a central point managing shares in operating companies. The Netherlands, Luxembourg, sometimes Cyprus—these jurisdictions offer extensive networks of double-taxation treaties and can actually reduce the group’s total tax burden.
But this requires substance. An actual office, employed people, real management occurring in the place of the company’s registration. You can’t run a Cypriot holding from Warsaw. It must be a real management structure in Cyprus, with a Cypriot board making decisions there.
Costs? They start at several tens of thousands of euros annually for the smallest structures. For serious holdings, it’s hundreds of thousands. For someone with a solo operation or small firm, it’s economic nonsense.
Investment Funds and Investment Vehicles
The Caymans, Delaware, Luxembourg are popular places for registering investment funds for good reason. Tax neutrality makes sense when a fund aggregates capital from investors in different countries who will settle individually according to their local regulations.
But again: an investment fund is a complex legal structure requiring an administrator, auditor, custodian, portfolio manager. Minimum costs are tens of thousands of dollars annually. For an individual simply wanting to invest their own savings? Senseless.
Intellectual-Property Holding (I.P. Holding)
If you’re creating valuable intellectual property—patents, trademarks, copyrights—a structure with an I.P. holding in a jurisdiction with favorable taxation of royalties can theoretically reduce taxes.
Theoretically, because in practice, states have introduced provisions aimed at such constructions. Royalties paid to “tax havens” often are subject to withholding tax at twenty per cent with no possibility of reduction. Transfer-pricing regulations require that prices for licenses be “market-rate”—you can’t simply transfer all profit to the I.P. holding by paying astronomical licensing fees. C.F.C. regulations again may cause the I.P. holding’s income to be taxed in Poland.
And again: this requires substance. An actual team managing I.P., actual development activity, actual contribution to I.P. value from the offshore company. Without this, the tax authorities will classify the whole thing as an artificial construction aimed at tax avoidance.
Trading Companies for International Business
If you actually conduct international operations—importing goods from Asia, selling to Europe—a company in a neutral location can simplify financial and logistical flows. Singapore, Hong Kong, Dubai are popular locations for such trading structures.
But—and this but is fundamental—the company must have real presence there. Office, employees, actual business operations conducted locally. If the Singapore company is just a “paper” structure while actual management and operations occur in Poland, we’re back to the problem of place of effective management and tax residency in Poland.
What About Ownership Anonymity?
Let’s return to an issue that often comes up in the context of offshore: the possibility of not publicly disclosing ownership.
The truth is that since around 2016, “anonymous” companies have practically ceased to exist in the civilized world, with the exception of the United States. The United Kingdom introduced a public register of beneficial owners in 2016. The European Union required similar registers under the fourth and fifth A.M.L. directives. The United States introduced the Corporate Transparency Act in 2024—though it was partially rolled back in March, 2025, eliminating requirements for American companies but leaving them for foreign companies.
Yes, there are jurisdictions where beneficial ownership isn’t publicly available. The Caymans, B.V.I., Seychelles, Marshall Islands—in these places, information about owners is held by registered agents, not in a public register. This seems tempting.
But there’s a fundamental problem we’ve already mentioned: you cannot use such a company for anything meaningful without disclosing beneficial ownership.
Want to open a bank account? The bank requires disclosure of beneficial owners. Want to buy real estate? The notary and mortgage bank require disclosure. Want to conduct e-commerce and accept card payments? Payment processors require full ownership documentation. Want to invest in the stock market? The broker requires K.Y.C., including beneficial ownership.
What’s more, all these professionals—bankers, lawyers, accountants, notaries—are “obliged entities” subject to A.M.L. regulations. They not only must collect beneficial-ownership information from you but are obligated to report “discrepancies”—divergences between what you declare and what appears in registries, or between what you declare and what emerges from their due diligence.
The only “anonymity” you can actually achieve is protection from being Googled by a nosy neighbor. If someone simply searches your name online, they won’t find you as owner of a Cayman company, because the Caymans don’t have a public register. But every financial institution, every legal or accounting professional, every government authority—they’ll all learn your identity the moment you try to do anything with that company.
This isn’t anonymity. It’s an illusion of anonymity that collapses upon first contact with the real world.
Reputational Cost: Hidden but Real
There’s another cost rarely discussed: reputational.
In 2016, the Panama Papers leaked. In 2017, the Paradise Papers. Massive troves of documents from law firms servicing offshore structures. Names appeared in media around the world. Politicians, celebrities, businesspeople.
Most of them weren’t doing anything illegal. Many had legitimate business reasons for their offshore structures. But the reputational damage was enormous. “Offshore” became synonymous with tax evasion, criminality, corruption—justly or unjustly.
If you run a B2B business and your counterparty discovers that invoices come from a B.V.I. or Cayman company instead of an ordinary Polish or American firm—what will they think? Won’t they start wondering what you’re trying to hide?
If you’re bidding for a public contract or working with a large international corporation with restrictive compliance policies—won’t an offshore structure automatically disqualify you?
If you want to secure financing from a bank or investor—won’t a complicated offshore structure raise red flags and diminish your credibility?
These are real business costs that don’t appear on the registered agent’s invoice.
When Offshore Makes No Sense
To be completely clear: there are situations where the idea of an offshore company is not just uneconomical but outright harmful.
Solo Service Operations: Freelancers, consultants, programmers, graphic designers. If the only “operation” is you personally providing services, an offshore company will give you nothing but costs and problems.
Small Local Firms: If your clients are in Poland, suppliers in Poland, employees in Poland, operations physically in Poland—offshore makes no sense whatsoever. The place of effective management will be in Poland, so the company will be a Polish tax resident either way.
“Avoiding the Polish Tax Office”: If the sole or primary reason for considering offshore is the desire to avoid Polish taxes on activity actually conducted in Poland—it won’t work. Provisions on place of effective management and C.F.C. will cause you to be taxed in Poland anyway, and you additionally expose yourself to accusations of artificial constructions aimed at tax avoidance, which can result in sanctions.
“Hiding from Creditors”: Offshore isn’t a magic shield against creditors or civil claims. International conventions on mutual legal assistance, enforcement of foreign judgments, investigative tools—all this means that hiding assets offshore isn’t effective long-term and may constitute a crime (obstruction of enforcement).
Alternatives That Actually Work
If the goal is legal tax optimization and streamlining international business, there are solutions far simpler and more effective than offshore:
Estonian C.I.T. in Poland: Allows deferral of tax until dividend distribution. For companies reinvesting profits, it’s actual optimization without the complications of international structures.
I.P. Box: The Polish system of preferential taxation of I.P. income at a five-per-cent rate. It requires meeting conditions, but it’s completely legal and administratively simple.
Genuine International Expansion: If you actually want to operate internationally, consider establishing local operating companies in key markets—not as artificial optimization structures but as real entities conducting local business. This builds substance, facilitates serving local clients, can provide access to local investment incentives.
Tax Emigration (If Genuine): If you truly want to change tax residency—which we’ve written about in other articles—offshore can be one element of the puzzle, but only if you actually relocate, live there, and conduct real operations there. This isn’t an accounting trick—it’s a fundamental life change.
When to See a Lawyer
If, after reading all of the above, you still believe your situation might justify an international structure, absolutely don’t do this yourself.
You need advice from a lawyer specializing in international tax law. Not from a firm offering “package registration” for fifteen hundred dollars. You need someone who will understand the entirety of your business situation, analyze tax consequences in Poland and in the target jurisdiction, help design a structure with actual substance, advise on compliance matters.
Such advice will cost. Several, sometimes dozens of thousands of złoty. But if you actually run a business at a scale justifying an international structure, this cost is a necessary investment. Trying to “do it cheapest” by using ready-made package solutions without proper legal advice is a recipe for catastrophe—from blocked bank accounts to problems with the tax authorities to potential criminal consequences.
The Most Honest Advice
Paweł with his marketing agency and Michał the programmer—both arrived at the same conclusion in the end, though by different routes.
Paweł tried. He established a company in the Caymans. For six months, he tried somehow to make it work. The bank refused to open an account four times. Eventually, he found one bank that agreed—but the compliance requirements were so invasive, and the fees so high, that the whole thing made no sense. And worst of all: his Polish tax adviser explained that, as a company with its place of effective management in Poland, it would be taxed in Poland anyway. Paweł closed the Cayman company. He lost about thirty thousand złoty on fees, advice, and wasted time.
Michał reached his conclusion earlier. After a week of research, he understood that a Delaware structure for a solo freelancer made no economic sense. Instead, he established an ordinary Polish sole proprietorship, chose the flat tax. He pays his 8.5-per-cent linear tax, has a transparent situation, doesn’t have to worry about international compliance.
Both are where they should have been from the beginning.
If you run a normal, honest business—you don’t need offshore. Administrative costs, compliance complications, banking problems, reputational risks—all this means that for ninety-five per cent of Polish entrepreneurs, offshore is simply a bad idea.
There are those narrow five per cent of situations where it actually makes sense—large international capital groups, investment funds, structures with actual international operations distributed among jurisdictions.
For everyone else: save yourself the money, stress, and potential legal problems. A Polish limited-liability company, sole proprietorship, Estonian C.I.T.—these ordinary, boring, local structures work well for the overwhelming majority of businesses. And they let you sleep peacefully, knowing you’re not violating regulations or arousing unnecessary suspicion from authorities.
This isn’t moralizing. It’s pure pragmatic calculation: do the benefits outweigh the costs and risks? For most, the answer is clear: no.
