The Federation of Polish Entrepreneurs (FPP) has given its backing and vocal support to the measures passed on 1 January 2019 by the country's legislature. The Act gives entrepreneurs the chance to take advantage of opportunities provided by the "Small ZUS", an arm of the Polish social security department. The new legislation concerns the effect on small businesses caused by social security contributions.
A small ZUS fund is provided for entrepreneurs who operate on a small scale, or are having temporary difficulties. Entrepreneurs who earned a monthly income in the previous year less than 2.5 times the minimum wage will be eligible to take advantage of the rules. Those entitled to the benefit in 2019 will be able to pay contributions of between PLN 520 and PLN 1232.
Small businesses are given 7 days to register with the scheme, meaning the deadline was 8 January, and almost 130,000 people applied in 2019.
Photo: Cezary Aszkiełowicz / Agencja Wyborcza.pl
"The Entrepreneur's voice shows how important it is to discuss the postulates of entrepreneurs. The current level of social security contributions was a heavy burden for small businesses. Introducing the so-called "small ZUS" is a step in the right direction. The systemic linking of social security contributions to the effects of business operations is crucial, "says Marek Kowalski, chairman of the Federation of Polish Entrepreneurs, president of the Center for Legislative Analysis and Economic Policy (CALPE).
The new solution is complementary to the "unregistered activity" and "relief to start" introduced previously by the Constitution of Business. Small business activity with revenues not exceeding half the minimum wage does not require registration and payment of premiums. Entrepreneurs who prosper better and register their activities may use the exemption for paying social contributions for 6 months. After this period, they have the possibility to pay the reduced ZUS contributions in the amount of PLN 520 for two more years. If after such an initial activity the company does not develop on a larger scale, i.e. it does not reach monthly average income above 2.5 times the minimum wage, it may pay the reduced premiums in accordance with the rules of the new act. In this way, the period of paying smaller contributions allowing for the development of business wings was extended and conditions for the survival of the company were created if it was temporarily in a difficult situation.
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