Startup relief for former shareholders of a Polish LLC (sp. z o.o.) raises many questions among entrepreneurs. Can you benefit from this relief when opening a sole proprietorship after closing your company? What are the applicable rules? How does ZUS approach this? Let’s take a closer look.
ZUS Relief for New Businesses — What You Should Know?
When setting up a sole proprietorship in Poland, new entrepreneurs can benefit from significant ZUS reliefs:
(1) Initially, there is the startup relief — no social insurance contributions are due for the first six months (only the health insurance contribution applies).
(2) For the following 24 months, entrepreneurs can take advantage of preferential ZUS contributions (“small ZUS”) — reduced social insurance contributions based on a lower assessment base.
However, not everyone qualifies for these reliefs. The law specifies certain conditions — and in practice, there is much uncertainty about whether former shareholders of a Polish LLC (sp. z o.o.) can benefit from startup relief and/or small ZUS.
Startup Relief for Former Shareholders — Key Rules
Startup relief is regulated under Article 18(1) of the Polish Entrepreneurs’ Law. According to this provision, startup relief is available to an individual entrepreneur who is either starting a business for the first time, or resuming it after at least a 60-month break (since the last closure or suspension of previous activity), and is not providing services to a former employer.
The key issue is how to interpret “starting a business.” The Entrepreneurs’ Law defines business activity as profit-oriented manufacturing, trading, construction, service, or professional activity conducted independently, in an organized and continuous manner.
This definition covers a typical sole proprietorship registered in CEIDG, but generally does not cover shareholders of a limited liability company (LLC), which is a separate legal entity.
What Does This Mean for a Former Single-Member Shareholder?
If you were the sole shareholder of an LLC, this means you were not conducting business as a natural person. Even if you were subject to ZUS contributions (since ZUS treats such shareholders as conducting non-agricultural business activity for contribution purposes), formally you were not an entrepreneur listed in CEIDG.
ZUS explicitly confirmed this interpretation in its individual decision dated June 30, 2021 (Ref. WPI/200000/43/463/2021).
The decision emphasized that merely being a shareholder in a single-member LLC does not trigger the negative condition in Article 18(1) of the Entrepreneurs’ Law — which refers to conducting business activity, not any type of non-agricultural activity.
In other words: if you spent the last few years as a shareholder and manager of your own LLC but did not run a sole proprietorship, you are considered to have the required “break” for startup relief purposes.
Startup relief for the former shareholder – Conclusion
Startup relief for former shareholders of a Polish LLC is good news! When setting up a sole proprietorship, you can benefit from the relief — paying only the health insurance contribution for the first six months.
This approach is confirmed by ZUS interpretations and provides real savings at the start of your new business journey.
If you have questions about ZUS contributions or whether you can benefit from ZUS reliefs, feel free to visit us at www.outsourced.pl.
