You conduct an agricultural activity and you would like to set up a company and wonder if at the same time you are eligible to KRUS insurance? In accordance with the provisions, if you start non-agricultural economic activity (within the meaning of the Act of 2 July 2004 on freedom of economic activity) or you start cooperation on the conduct of business as a person cooperating with an entrepreneur, you can keep your right to stay in KRUS. However, you need to meet a number of requirements (at the same time):
- continuously for at least 3 years you were covered by insurance in KRUS in the full scope and at the same time you continue to conduct agricultural activity, or permanently work on an agricultural holding with more than 1 conversion hectare of arable land.
- you submit a declaration on the decision to continue this insurance within 14 days upon the date of commencement of non-agricultural economic activity or cooperation in such activity. Declaration on the continuation of farmers' social insurance may also be submitted on an application for entry in the Central Registration and Information on Business (CEIDG-1). Submission of application in this form to the registration authority is considered as meeting the deadline to submit a declaration in KRUS
- you are not an employee and you do not remain in a labour relation (e.g. work in uniformed services),
- you do not have a fixed right to old-age or disabilty pension or to social insurance benefits,
- conducting economic activity, you can remain in KRUS provided that the amount of the income tax due for the previous tax year on revenues from your economic activity does not exceed a specified limit. This amount is revised annually and is published in the form of an announcement of the Minister of Agriculture, published in the Official Gazette of the Republic of Poland "Monitor Polski" (here for 2015). The annual limit of income tax payable from revenues from non-agricultural economic activity for the year 2015 was PLN 3204.
Important! As a start of non-agricultural economic activity shall also be considered:
- resuming performance of non-agricultural economic activity, the pursuit of which was temporarily suspended;
- amendment of the type or object of the activity in accordance with the Polish Classification of Activities (PKD) (go to PKD search engine)
If you conduct economic activity being a farmer at the same time, you should remember about completing all formalities which allow to stay in KRUS. If you fail to meet them or to meet the relevant deadlines, you may be deprived of the right to agricultural insurance. Then your obligation is to register for insurance in the Social Insurance Institution. In the publication Registration for social security in ZUS of entrepreneurs insured in KRUS you will find the necessary information about it. You can find out more in the section Contributions payer to ZUS.
- By 31 May of each calendar year, the farmer/household member conducting non-agricultural economic activity is required to submit to the relevant unit of KRUS a certificate (issued by the head of the tax office) or a declaration that the amount of income tax due on revenues from non-agricultural economic activity for the previous tax year has not exceeded the annual threshold limit,
Please note that under the Act on freedom of economic activity, not every farmer's non-agricultural activity constitutes an economic activity which is subject to this Act . A farmer who operates in forestry or inland fishing, and also rents accommodation, sells home-made meals and provides other services connected with the stay of tourists, is not an entrepreneur. In addition, wine production by producers who are farmers producing less than 100 hl of wine per marketing year as well as activity of farmers in the sale referred to in Article 20(1) of the Act of 26 July 1991 on income tax on natural persons, is not considered as economic activity.
NOTE - you cannot remain insured in KRUS if:
- you are member of commercial partnerships ( such as registered partnership, limited partnership, professional partnership and single-person limited liability company);
- you are a person conducting activity in the freelance professions within the meaning of the Act on lump sum income tax on selected types of revenues received by natural persons, the revenues from which are regarded as revenues from an economic activity within the meaning of provisions on personal income tax.
The rules for participation in KRUS is regulated by the Act of 20 December 1990 on social security of farmers.
As you have already found out, the right to remain in KRUS have persons who will cooperate in carrying out activity as a person cooperating with an entrepreneur. A person cooperating with those conducting non-agricultural activities shall be considered:
- a spouse,
- own children, children of the other spouse and adopted children,
- stepmother and stepfather and
- adoptive persons if the parties remain in common household with them and cooperate in the course of such activities.
The above does not apply to persons with whom the employment contract was concluded with a view to professional training.
How to determine persons jointly carrying out household?
In determining whether persons have a common household, the following things are taken into account: the joint registered address (residence), keeping of the joint household budgets, cooperation in dealing with matters of daily life. It must, therefore, be assumed that cooperating parties are the immediate family members, in a common household with the person engaged in an economic activity, contributing to operate, acting for and on behalf of the person engaged in activity, involved in the running of the business.
In determining of the cooperation it is examined whether the relationship between a person and a cooperating party has the characteristics of an employment relationship and, in particular, whether there is a relationship of subordination between those persons.
Another point to which attention should be drawn is regularity in the provision of work for a person who operates (e.g. regular work for 8 hours per day for 5 days per week shows the employment relation).
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