Relief for starting a business - own company for 6 months without ZUS
Do you want to start a business? If you are registering for the first time or if it has been 5 years since your previous activity ended, from 30 April 2018 you can take advantage of the relief for starting a business and do not have to pay social security contributions to the Social Insurance Institution (ZUS) for 6 months.
What is a relief for starting a business?
Under normal circumstances, every entrepreneur who registers a company with CEIDG and is not insured in any other respect (e.g. employment) is obliged to register with the Social Insurance Institution (ZUS) for social insurance (old-age pension, disability, accident) and health insurance and to pay full or preferential contributions for such insurance (so-called small ZUS).
Thanks to the new relief you do not have to pay social security contributions ( old-age pension, disability, accident, sickness ) for 6 months from starting your business.
Note! The relief does not apply to health insurance. If you take advantage of the relief, you do not have to pay social security contributions, but you are obliged to register for health insurance and pay monthly health insurance contributions. You will be able to deduct your health insurance contribution from your tax (not from your income). Find out more about how to account for your health insurance contribution in taxes.
After the full 6 calendar months you can take advantage of another relief - the so-called small ZUS, which allows you to pay lower contributions for the next 24 months.
How to calculate the 6-month period of the relief
The maximum duration of the relief for starting a business is 6 calendar months. The start date shall be the date on which the business is actually to commence. If this day falls on the first day of a calendar month, this month is included in the 6 months of the relief duration. If you start your business in the course of a calendar month, do not include this month. The discount lasts for the full 6 months.
Jan Kowalski will start his business activity on 7 May 2018. He meets the conditions to take advantage of the relief for starting a business. The six months for which he will not pay social security contributions will expire on 30.11.2018.
Who can benefit from the relief for starting a business
The relief is available to entrepreneurs who:
- are natural persons (i.e. are engaged in sole proprietorship or are partners in civil law partnerships)
- undertake a business activity for the first time or resume it after a period of at least 60 months from the date of its last suspension or termination
- do not perform activity for a former employer, where in the current or previous calendar year they were employed and performed activities falling within the scope of currently performed activity
- are not subject to insurance with KRUS
Important! During the period of the relief, the persons cooperating with you and the employees hired by you or contractors will be covered by the social insurance. Exemption from social insurance only applies to you as a self-employed person.
What are the formalities of the Social Insurance Institution (ZUS) in terms of relief for starting a business?
If you register your business, you will automatically be registered as a payer of social security contributions (you do not have to register separately with the Social Insurance Institution as a payer). However, within 7 days from the date of starting your business you must separately register with the Social Insurance Institution (as the insured person) for health insurance ZUS ZZA with the insurance title code beginning with the numbers 05 40.
How much I will pay when using the relief for starting a business
You will pay the health insurance contribution on the declared amount, however, not less than 75% of the average monthly salary in the enterprise sector in the fourth quarter of the previous year, including the payments from the profit (in 2018 it is the amount of 3554,93 PLN). The health insurance contribution is 9% of the basis of assessment. In 2018, the lowest contribution is PLN 319,94 and this is what you should pay to the Social Insurance Institution (ZUS) every month.
This contribution is monthly and indivisible, i.e. you pay it in full regardless of the number of days you are subject to health insurance in the month.
Exemption from payment of health insurance
You may be exempt from paying a health insurance contribution for your business during the relief for starting a business. This will be the case if:
- you are a pensioner and your benefit does not exceed the minimum monthly salary and your revenues do not exceed 50% of the amount of the lowest pension per month or you will pay income tax in the form of a tax card,
- you have a moderate or severe disability and your revenues will not exceed 50% of the amount of the lowest pension per month or you will pay income tax in the form of a tax card,
- you are entitled to a maternity allowance that does not exceed the amount of your parental benefit per month.
If you have a moderate or severe disability and only carry out this activity, you will pay a health insurance contribution that does not exceed the amount of your personal income tax advance.
ZUS declarations while using the relief
If you pay the health insurance contribution only for yourself, you are obliged to submit to the Social Insurance Institution ZUS DRA declaration in which you show the amount of contributions paid (see more information about submitting the declaration) by the 10th day of the month following the commencement of your business activity and your application for insurance. You do not have to submit a ZUS DRA declaration (unless you hire employees) until the end of the period of benefitting from the ZUS relief. You submit your next declaration only for the month in which you will be obliged (after 6 months) to report to the "full" insurance.
Relief for starting a business and suspension of the company
If you suspend your activity during the period in which you benefit from the relief, the suspension period will not interrupt the period of 6 months.
You can apply for voluntary health insurance during the suspension period
Resigning from relief
Remember! The possibility to take advantage of the ZUS relief is your right and not your obligation. If you wish to resign from the relief, you should report it to the Social Insurance Institution (ZUS) on normal terms.
Important! If you resign from the relief, to which you are entitled, you will be able to use it again only after 60 calendar months from the date of its termination or suspension.
What happens after the relief for starting a business
After 6 months of starting the relief, for 24 calendar months you will be paying the so called small ZUS. Similarly, if you resign from relief before 6 months have passed. A small ZUS counts for a full 24 months, so if you resign from the relief in the middle of the month, for example, the period of a small ZUS will not start to count until the next month.
After 6 months of starting the relief or earlier if you have resigned from it, de-register from your health insurance on the ZUS ZWUA form with the insurance title code beginning with the numbers 05 40, then report to the insurance under a small ZUS with the insurance title code beginning with the numbers 05 70. If you are entitled to disability pension - with the code 05 72.
What you should be aware of when taking advantage of the relief
If you take advantage of the relief and do not pay your social security contributions for 6 months, you will not be entitled to the benefits of these insurances during this period. If you fall ill, you will not receive sickness benefit; if you have an accident at work, you will not be entitled to accident benefit.
If you want to have full insurance, you can apply to the social security insurance in ZUS (at any time within 6 months of the relief being in force). You have the right to take advantage of the possibility to pay lower contributions, i.e. the so-called small ZUS.
Remember that after 6 months you are obliged to register with the Social Insurance Institution (ZUS) for full or small ZUS.