Contribution holidays – a new relief option for micro-enterprises

Starting in November 2024, micro-entrepreneurs in Poland can apply for Social Insurance Institution (ZUS) contribution holidays, a new relief measure allowing them to be exempt from paying ZUS contributions for one chosen month each year. This relief targets those who meet specific criteria and covers selected social security contributions, which will be financed by the state budget for the month in question. What benefits do ZUS contribution holidays offer, who is eligible, and how can you properly apply?

What are Social Insurance Institution (ZUS) contribution holidays?

ZUS contribution holidays provide relief for sole proprietors and partners in civil partnerships who meet certain conditions. This measure allows them to avoid paying specific contributions for one month each year. The relief covers contributions for:

• Mandatory social insurance: pension, disability, and accident insurance,
• Voluntary sickness insurance (if the insured person was voluntarily covered in the application month and the month prior),
• The Labour Fund and Solidarity Fund (if applicable to the entrepreneur).

These contributions will be financed by the state, meaning the entrepreneur can still receive social benefits and continue building their retirement capital.

Note: ZUS contribution holidays do not include health insurance contributions, which must be paid by the entrepreneur himself.

What are the benefits of ZUS contribution holidays?

ZUS contribution holidays provide several significant benefits for micro-entrepreneurs:

• Insurance Continuity: Despite the one-month contribution exemption, entrepreneurs retain their right to pension, disability, and sickness benefits.
• No Suspension of Business Operations: During the contribution holidays, the entrepreneur can continue running his business, generating revenue, and issuing invoices without needing to suspend operations.
• Flexibility: Each entrepreneur can choose the month for the exemption, allowing them to plan the relief for the most convenient period.

Who is eligible for ZUS contribution holidays?

This relief is aimed at micro-entrepreneurs running businesses registered in the Central Registration and Information on Business (CEIDG) register, including court bailiffs.

Applicants must meet specific conditions, including:

1. Limit on the Number of Insured Persons: The business cannot have more than 10 individuals registered for insurance, including employees, contractors (excluding students and pupils under 26), and collaborators.
2. Annual Revenue: In the two calendar years preceding the application year, the business’s revenue must not have exceeded 2 million euros.
3. Independence from Former Employers: The entrepreneur cannot conduct business for a former employer if he performed similar duties under an employment contract in the year he started his business or the previous year.
4. De Minimis Aid: Contribution holidays are granted under the de minimis aid scheme, which stays subject to defined limits under EU regulations. The limit is generally 300,000 euros over three years for most businesses and 100,000 euros for transport companies.

Important: The entrepreneur must attach certificates of received de minimis aid over the past three years or submit a declaration if no aid was received.

Any entrepreneur who meets the conditions above can benefit from the contribution holidays, regardless of his tax calculation method (general rules, flat tax, lump-sum tax, or tax card).

How to Apply for ZUS Contribution Holidays

The application for ZUS contribution holidays must be submitted electronically through the ZUS Electronic Services Platform (PUE). To be eligible for the relief, the RWS application must be submitted in the month preceding the chosen month for exemption. For example, if the entrepreneur wants to apply for December, the application should be submitted in November.

Note: If the entrepreneur operates as part of a civil partnership, he should submit the application from his individual payer account on PUE, not the partnership’s account. Partners in civil partnerships who wish to apply must have individual payer accounts on PUE, as the partnership itself is only the payer of contributions for employed workers.

Are ZUS contribution holidays beneficial for everyone?

Before deciding to use ZUS contribution holidays, it is advisable to carefully assess the profitability of this solution. Due to the need to continue paying health insurance contributions (calculated based on income or revenue minus social security contributions), the relief should be evaluated in the context of all obligations.

Summary

ZUS contribution holidays offer a valuable option for micro-entrepreneurs, reducing business costs for one month each year. With contributions funded by the state, entrepreneurs can focus on business development and daily operations during this period. However, to take advantage of the relief, it is crucial to meet the specified conditions and submit the application on time.

If you have any further questions or require additional information, please contact your business relationship person or use the enquiry form on the HLB Poland website.

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