How much can you earn on top of your pension by running your own business in 2025?

For many people, retirement does not mean giving up work. According to data from the Social Insurance Institution (ZUS), in 2024 as many as 872,600 senior citizens were in work, and nearly 30 per cent of them were self-employed. A question that often arises in relation to self-employment and retirement is: could earning extra income whilst retired in 2025 result in a reduction or suspension of your pension?

The answer depends on whether you have already reached the standard retirement age – 60 for women and 65 for men. If so, you can run a business and earn extra income without any limits – your income will not result in your pension being suspended or reduced. The exception is people receiving the minimum pension increased by ZUS – in their case, any income exceeding the amount by which the pension has been increased to the minimum results in the loss of the top-up. However, those on early retirement must adhere to the following thresholds: exceeding 70 per cent of the average monthly wage (in the fourth quarter of 2025 – 6,140.20 PLN) results in a reduction in the benefit, whilst 130 per cent (11,403.30 PLN) leads to the suspension of payments.

In practice, as the experience of ‘Firma dla Każdego’ shows, those who have reached the statutory retirement age have the greatest freedom to earn additional income. In the case of early retirement, it is crucial to monitor income, which is based on the declared amount of social security contributions rather than the company’s actual profit.

What social security contributions will you pay if you run a business whilst retired?

From 2025, a pensioner running a sole trader business will not have to pay social security contributions: pension, disability or accident insurance – this is a huge difference compared to an active entrepreneur. The only compulsory contribution remains the health insurance contribution. The amount depends on the chosen form of taxation, but cannot be less than 9 per cent of the minimum wage (from February until the end of 2025 – PLN 314.96 per month).

Importantly, it is possible to be exempt from paying the health insurance contribution if two conditions are met together: the gross pension does not exceed the minimum wage (from July 2025 – 4,300 PLN), and income from business activities does not exceed 50 per cent of the minimum pension (from March 2025, this is 939.46 PLN). Alternatively, the exemption also applies to pensioners who settle their tax liability using a tax card. In any case, even if you are exempt from contributions, you must submit a tax return to ZUS.

In practice, clients of the ‘Firma dla Każdego’ Accounting Office often ask whether they can, despite being exempt, voluntarily pay social security contributions. Yes, but this is entirely your own decision – you can continue to pay pension and disability contributions to increase your future benefits, but you will no longer be covered by sickness insurance or the Labour Fund.

How to set up a sole trader business in retirement – step by step

The process for a pensioner to register a sole trader business in 2025 does not differ significantly from the procedure for younger entrepreneurs. You must have full legal capacity and not be under a legal incapacity order. You can submit an application for entry in the CEIDG online or at your local council office. In the case of general partnerships or limited liability companies, there is also nothing to prevent you, as a pensioner, from becoming a partner.

A new development from 2026 will be the inclusion of the period spent running a business in your length of service on an equal footing with full-time employment – provided you have paid social security contributions. This change levels the playing field for self-employed pensioners in terms of access to employees’ rights and certain benefits.

When registering your business, you must also notify ZUS of your new status, using the appropriate insurance title code for pensioners (e.g. 05 10 10 for the ‘Duży ZUS’ scheme). Once you start receiving your pension, deregister from your previous social security contributions and register solely for health insurance.

Does running a business affect the amount of your pension?

The amount of your future pension from self-employment depends on the total of accumulated and index-linked contributions in your ZUS account, as well as the initial capital (for the period prior to 1999). The formula is simple: the total funds accumulated in your ZUS account divided by your projected remaining life expectancy (as published by the Central Statistical Office (GUS)). The higher the contributions you pay whilst you are in employment, the higher your pension will be.

Self-employed people who have paid the lowest contributions over the years often receive a pension below the average. According to ZUS data, in 2024 the average pension for men was 4,674.51 zł gross, and for women PLN 3,208.70 gross, whilst many self-employed people receive the minimum pension – in 2025, this amounts to PLN 1,878.91. The example of Mr Tomasz, who paid only the minimum contributions for 20 years, shows that his projected pension amounts to just 30 per cent of his previous business income.

If you want a higher pension, you can declare a higher contribution assessment base. The maximum contribution base in 2025 is 19,560 PLN, and with contributions based on this amount, the monthly payment to ZUS amounts to over 6,600 PLN. This is an option for those who are planning for long-term financial security and can afford such contributions.

What tax reliefs and exemptions are available to retired entrepreneurs in 2025?

Pensioners running a business can benefit from several tax reliefs. The most important of these is the so-called PIT-0 for senior citizens, i.e. an income tax exemption up to a limit of 85,528 zł per year on income from employment (including business activities) earned after reaching retirement age. The condition is that the person must not be receiving a pension at the time of claiming the relief.

All three forms of taxation are available: the tax scale, the flat-rate tax and the lump-sum tax on recorded income. Senior citizens can use simplified tax filing methods (e.g. a tax card), which makes running a business easier and reduces paperwork. The obligation to submit an annual tax return remains – you must declare income from both your business and your pension.

Experts from Firma dla Każdego recommend consulting a tax adviser, particularly if you are claiming tax relief or have variable income. In 2025, it is worth keeping track of the new thresholds and filing your tax return in accordance with current regulations to avoid unnecessary tax adjustments or penalties.

How to settle contributions and taxes – practical examples

In practice, a pensioner running a business must choose a form of taxation and settle their accounts with ZUS regularly. For example, Mr Roman, a pensioner running an online shop, generates income of over 16,000 zł per month and receives a gross pension of 6,500 zł. He is only required to pay health insurance contributions. Conversely, Ms Klaudia, with a pension of 5,200 zł and business income of 1,500 zł, is also liable only for the health insurance contribution, but may benefit from a statutory exemption if she meets the relevant conditions.

The annual tax return involves submitting a PIT-36 (tax scale), PIT-36L (flat-rate) or PIT-28 (lump sum) form, and a separate PIT-37 form for pension benefits. In ZUS DRA declarations, pensioner status and the declared contributions must be indicated accordingly. People running an unregistered business, i.e. with income below 10,000 zł per month (the limit for 2025), are not obliged to pay ZUS contributions and may carry out business activities ‘on a trial basis’, which is particularly convenient for those testing out a business whilst in retirement.

In the experience of Firma dla Każdego, clients often take advantage of the opportunity to operate under the umbrella of an incubator foundation, particularly when they wish to avoid the formalities associated with full sole trader registration and the high ZUS costs at the outset. More practical tips can be found at firmadlakazdego.pl.

Is it worth paying voluntary social security contributions in retirement?

If you run a business whilst in retirement, you can voluntarily pay pension and disability insurance contributions – this is an option for those who wish to increase their future pension or protect themselves in the event of a long life. These contributions are not compulsory, but paying them also means you must pay an accident insurance contribution.

In practice, the decision to pay voluntary contributions depends on your financial and health situation. As research by the Central Statistical Office (GUS) has shown, for many older people, every additional year of work and contribution payments increases their future pension by up to 10 per cent. It is worth remembering, however, that pensioners cannot take out voluntary sickness insurance – this entitlement is reserved exclusively for those for whom social security contributions are compulsory.

There are also alternative solutions available on the market, such as the provision of legal personality by business incubators (e.g. ‘Firma dla Każdego’), which allow you to run a business without registering as a sole trader and without having to pay high social security contributions from the outset. This is a convenient option for freelancers, people in debt or those testing their own business idea without any risk.

What are the alternative ways for entrepreneurs to secure their pensions?

A ZUS pension for an entrepreneur who has paid the lowest contributions over the years rarely matches the benefits received by full-time employees. That is why an increasing number of self-employed people are choosing to set aside funds in the third pillar – an IKE (Individual Pension Account) or an IKZE (Individual Pension Security Account). In 2025, the contribution limit for an IKZE for self-employed individuals is PLN 15,611.40, and for an IKE – PLN 26,019.

You can deduct contributions to an IKZE from your income on your PIT return, which reduces your tax liability. If you withdraw the funds after the age of 65, you will pay only a flat-rate tax of 10 per cent, and the funds are inheritable by your family. An IKE allows you to make a withdrawal free of ‘Belka tax’ once you reach the age of 60 – this is an attractive option for those who wish to build up capital for their retirement independently.

Alternative options also include investments in property, investment funds or insurance policies with a savings component. The choice depends on your individual needs, risk appetite and plans for the future. Experts from Firma dla Każdego recommend diversifying sources of retirement income so as not to rely solely on the state pension scheme.

How does unregistered self-employment affect your pension?

For pensioners who do not wish to register a business with the CEIDG straight away, unregistered business activity is an attractive option. In 2025, the income limit is 10,000 zł per quarter. Such activity does not require the payment of social security contributions (ZUS) and does not require full accounting records to be kept. Income earned in this way does not affect the suspension of your pension, provided you do not exceed the limits for early retirement.

This arrangement is particularly popular amongst people who want to test their business idea without the risk of losing their benefits. It is worth bearing in mind, however, that unregistered business activity does not build up capital for future pension benefits – you do not pay either social security or health insurance contributions.

If your business grows, you can switch to a fully registered business – in which case the rules described earlier will apply. At every stage, you can seek support from the experts at ‘Firma dla Każdego’, who will help you assess which structure is most advantageous.

What regulatory changes await entrepreneurs and pensioners in 2025/2026?

From 1 January 2026, the rights of entrepreneurs regarding length of service will be brought into line – periods of self-employment and contract work will count towards length of service, provided that social security contributions were paid. The amendment to the Labour Code aims to level the playing field between the self-employed and full-time employees, which is also significant when calculating severance pay, holiday entitlement and other employee benefits.

It is worth keeping an eye on changes to the income limits for early retirees. These thresholds are updated quarterly based on the average wage published by the Central Statistical Office (GUS). In 2025, these limits will be at a record high, meaning that an ever-increasing number of pensioners will be able to earn extra income freely.

In practice, as the experience of Firma dla Każdego shows, more and more senior citizens are taking advantage of flexible ways of earning an income – ranging from unregistered self-employment, through sole traders, to limited liability companies (sp. z o.o.) and collaboration with business incubators. You can find detailed guidelines and the latest news on the firmadlakazdego.pl website.

FAQ: frequently asked questions about running a business whilst on a pension

Can I run a business and claim a pension at the same time?

Yes, once you’ve reached the standard retirement age, you can run a business without restrictions and won’t lose your entitlement to a pension. The exception is those on early retirement – they must ensure they stay within the income limits.

Do I have to pay all ZUS contributions as a pensioner running a sole trader business?

No, only the health insurance contribution is compulsory (unless you meet the conditions for exemption). You can pay social security contributions voluntarily – it’s up to you whether you want to increase your pension.

What documents are required to register a business whilst on a pension?

An application to the CEIDG (online or at a local office), a notification to ZUS with the correct insurance title code (for pensioners), and, in the case of companies, the relevant registration documents with the National Court Register (KRS).

Can I use the flat-rate scheme or a tax card as a pensioner?

Yes, pensioners have access to all forms of taxation. If you opt for the tax card scheme, you can also benefit from an exemption from health insurance contributions (provided you meet the statutory conditions).

Does it make sense to pay higher ZUS contributions whilst on a pension?

If you’re planning to increase your pension in the long term, yes – every additional year of paying contributions increases the amount of your future pension. However, this option is for those who can afford the higher costs of running a business.

Is running a business in retirement worthwhile?

Running a business whilst retired in 2025 offers a great deal of freedom and flexibility – obligations to ZUS are kept to a minimum, taxes can be optimised through tax reliefs, and the process of registering and running a business has become simpler than ever. The greatest financial benefits are enjoyed by those who carefully plan their contribution levels and make use of non-public forms of saving for the future – such as IKE and IKZE.

It is worth considering alternative business models, such as business incubators that provide legal personality – for example, ‘Firma dla Każdego’. Such solutions allow you to legally avoid high ZUS contributions at the outset and test ideas without the risk of losing your benefits. If you’re wondering which form of business is best for you, check out the latest information and guides at firmadlakazdego.pl.

It’s never too late to put new ideas into practice and secure some extra income for your retirement. The key lies in flexibility, making use of tax reliefs and managing your finances wisely. Thanks to this, retirement can be not only a time for rest, but also for active, fulfilling personal development.