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Wednesday, July 17, 2024

Social Security contributions. Holidays from ZUS. Project announcement. Piotr Juszczyk comments

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The government wants to adopt a draft law in the first quarter of 2024, which will introduce the possibility for people running sole proprietorships not to be subject to compulsory social insurance for up to three months a year – it is stated in the government’s list of legislative works. These are the so-called holidays from ZUS. An entrepreneur could save up to PLN 4,800.81 per year – says Piotr Juszczyk, chief tax advisor at inFakt.

“The answer to the growing public law burden on entrepreneurs will be the institution of contribution holidays. It provides that each entrepreneur running a sole proprietorship may inform the Social Insurance Institution of the intention not to be subject to compulsory social insurance, as well as about not paying contributions to the Labor Fund and the Solidarity Fund up to 3 calendar months during the calendar year. After the expiry of the period (or periods) of non-subjectivity, re-coverage by compulsory social insurance will take place automatically and will not require separate notification,” it was written in the government’s list of legislative works.

Using the solution will not affect the entitlement to sickness benefit – as long as voluntary sickness insurance contributions have been paid for the minimum period of 90 days specified in the regulations. The solution provided for in the project will be voluntary and addressed to all entrepreneurs sole proprietorship business regardless of the form of income tax settlement.

In the opinion of the project’s originator – the Ministry of Development and Technology – the introduced relief consisting in periodic reduction of the costs of running a business will contribute to relieving the financial burden on entrepreneurs, and the solution is aimed at limiting the scale of suspension and closure of business activities.

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Minister of Development and Technology Krzysztof Hetman announced on Thursday morning that the program will be in force in 2025, but it cannot be ruled out that it will start in 2024.

Holidays to ZUS. How much can you save?

As Piotr Juszczyk, chief tax advisor at inFakt, notes, this project is the implementation of the announcement made in the expose made by Donald Tusk (read also: Tusk announces holidays for entrepreneurs. What is it about?).

– The announcement shows that every entrepreneur will be able to take advantage of holidays from ZUS for up to three months a year. Importantly, at the moment there are no conditions for taking advantage of it – emphasizes Juszczyk.

He adds that the exemption will apply to social contributions, the Labor Fund and the Solidarity Fund. In the situation where in the current year ZUS contributions are at the level of PLN 1,600.27 per month, which means that entrepreneurs could save up to PLN 4,800.81 per year.

– This is a great help and a tribute to entrepreneurs. In my opinion, it will help many entrepreneurs, especially after the ZUS increase by nearly 33 percent in two years, and the health insurance premium burden. However, the regulations do not provide for exemption from health insurance contributions. This means that during the ZUS holidays, this contribution will be required. The final project is to be adopted by the end of this quarter, which means that entrepreneurs could feel relief from contributions this year, he comments.

Additionally, if the entrepreneur falls ill during such holidays, ZUS will pay him sickness benefit.

– In my opinion, if the project actually looks like this, this solution may be common. On the other hand, it may be worth considering the ZUS basis and, for example, reducing it by 25 percent, the cash effect would be the same. In this situation, entrepreneurs would feel relieved all year round, the expert concludes.

Main photo source: Shutterstock

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