How to avoid paying ZUS – legal strategies for optimising contributions for business owners

For business owners in Poland, the issue of social security contributions remains one of the most pressing matters relating to running a business. The social security system, based on the principle of intergenerational solidarity, has been a subject of debate for years amongst both entrepreneurs and financial experts. Rising costs, inflexible regulations and forecasts of low future benefits mean that an ever-growing number of entrepreneurs are seeking solutions to reduce or even eliminate the need to pay ZUS contributions. In this article, I present a comprehensive analysis of the most effective – and, above all, legal – ways to minimise the ZUS burden in business practice.

Why are business owners looking for alternatives to ZUS?

Contributions to the Social Insurance Institution (ZUS) – for both social security and health insurance – are among the highest in the region. In 2025, the monthly ZUS burden on an entrepreneur, including the health insurance contribution, will exceed 2,000 PLN. Crucially, this obligation applies regardless of whether the business generates revenue in a given month. For many entrepreneurs, particularly those running small or seasonal businesses, this level of taxation becomes a barrier to growth or even a reason to close down their business.

Another objective reason for optimising one’s tax situation is the inefficiency of the system and the fact that pensions paid by ZUS are increasingly failing to meet the basic needs of senior citizens. It is no wonder that more and more entrepreneurs are consciously opting for alternatives – ranging from investing in private forms of provision for the future to exploiting legal loopholes in the system.

Who is actually required to pay ZUS contributions?

The obligation to pay contributions stems from the Social Insurance System Act. It applies primarily to sole traders, partners in partnerships and sole members of limited liability companies. Exceptions include limited companies with at least two members, as well as specific cases of employment, which I will discuss further on. Knowledge of the regulations is key here – not only their literal interpretation, but also case law, which is increasingly working in favour of entrepreneurs.

Strategies for the legal optimisation of social security contributions

1. Operating as a limited liability company (sp. z o.o.)

The most significant change in the approach to ZUS occurred in February 2024 following a ruling by the Supreme Court. It was confirmed that a partner in a two-person limited liability company (even one holding 99 per cent of the shares) is not subject to compulsory social insurance. This is a breakthrough – previously, ZUS often treated companies with one dominant shareholder and one ‘nominal’ shareholder as sole proprietorships, imposing an obligation to pay full contributions. Now, with the right shareholding structure and genuine involvement from both shareholders, a limited liability company (sp. z o.o.) becomes an effective shield against ZUS.

• A partner is not subject to ZUS unless they are the sole owner.
• Remuneration may be drawn for appointment to the management board – this is subject only to income tax and health insurance contributions.
• Dividend payments are not subject to social security contributions, although they are subject to corporate income tax (CIT) and personal income tax (PIT) (so-called double taxation).
• Remuneration in the form of recurring non-monetary benefits (Article 176 of the Commercial Companies Code) is also not subject to social security contributions.

Note: a single-member company (even with a nominal shareholder) may be challenged if the other shareholder has no real influence over the company’s operations. ZUS and the courts analyse not only the percentage of shares held but also actual involvement; therefore, ‘front man’ arrangements are risky.

2. Simple Joint-Stock Company (PSA) – a modern alternative

A PSA allows a business to be run without the obligation to pay ZUS contributions, provided the shareholder’s contribution is exclusively in cash, rather than in the form of labour or services. This form is particularly attractive to sole traders who do not wish to seek partners for a limited liability company (Sp. z o.o.).

• No obligation to pay social security contributions where no services or labour are provided to the PSA.
• High flexibility in terms of capital structure and company management.

3. Unregistered business activity – minimum red tape, no social security contributions

This solution is designed for people whose monthly income does not exceed 75 per cent of the minimum wage (in 2024: PLN 3,225). Unregistered activity is not a business activity within the meaning of the Act – it does not require registration and does not give rise to an obligation to pay ZUS or health insurance contributions.

• You can carry out small-scale sales or provide services on a limited scale.
• There is no obligation to pay contributions as long as you do not exceed the income limit.

The only restrictions are the scale of the activity and the prohibition on carrying out this type of activity by persons who have conducted business activity within the last 60 months.

4. Contract for specific work – no social security contributions (subject to certain conditions)

A contract for specific work remains the only form of civil-law contract under which, as a general rule, no ZUS contributions are payable. Condition: the subject matter of the contract must be the creation of a unique, finished work (e.g. a design, text, graphic, or application). The work must not be of a continuous or repetitive nature, nor must it be carried out under the direct supervision of the client.

ZUS is increasingly checking that contracts for specific work are being used correctly. In practice, this means that contracts must be drafted carefully and the results of the work must be properly documented.

5. Contract of mandate for students under the age of 26

Employing a student or pupil under a contract of mandate before they reach the age of 26 allows you to avoid both social security and health insurance contributions – provided that the person in question has no other entitlement to social security cover. Once the person reaches this age or completes their studies, the contract becomes subject to full social security contributions.

6. Concurrent entitlement to social insurance – combining full-time employment with self-employment

Individuals who run a sole trader business whilst also being employed under an employment contract (with a salary of at least the minimum wage) are exempt from the obligation to pay social security contributions on their business income. The only contribution remaining is the health insurance contribution, which – although not entirely nominal – is significantly lower than the full contribution.

Similar rules apply to pensioners and those receiving maternity benefit who run a business as a secondary activity.

7. Social security ‘holiday’ – a new scheme from 2024

The ‘contribution holiday’, introduced in 2024, allows entrepreneurs to opt out of paying social security contributions for a selected month once a year. The health insurance contribution remains compulsory. To qualify for this relief, a number of conditions must be met, including a limit of 10 people registered for insurance and not carrying out business activities on behalf of a former employer.

• The application is submitted electronically via PUE ZUS.
• Social security contributions for the ‘holiday’ month are paid from the state budget.
• The relief does not apply to contributions for employees and contractors.

8. EU grants with a bridging allowance

People setting up a new business after closing their previous one and waiting for the required break may benefit from EU grants, including the so-called ‘bridging allowance’ – social security contributions paid for one or even two years. This is a temporary solution, but it offers the chance to develop the business without incurring additional contribution costs.

9. Running a business abroad or working in another EU country

Under EU Regulation No 883/2004, a person running a business in Poland can avoid paying social security contributions if they are genuinely employed under an employment contract (even on a part-time basis) in another EU country. For this strategy to be effective, the work outside Poland must be genuine and documented. Attempts to circumvent the law through fictitious employment are often detected and penalised, so I recommend caution.

10. Family foundation – a new optimisation tool

A family foundation enables the management of assets and the running of a business without the founder having to pay ZUS contributions, provided they do not carry out work for the foundation. This solution works particularly well in the context of succession planning and the protection of family assets, although it is not typically an ‘operational’ tool for sole traders.

Health insurance without ZUS – alternatives

Opting out of ZUS does not mean losing the right to healthcare benefits. An entrepreneur can obtain health insurance in several ways:

• Voluntary insurance with the National Health Fund (NFZ) (cost: from 671.60 PLN per month, with an additional fee for gaps in cover);
• Registration via a spouse or parent (if you have no other basis for insurance);
• Registration with the Job Centre as unemployed (provided certain conditions are met, including having no income from business activities);
• Volunteering with a non-governmental organisation (insurance is paid for by the organisation, with the contribution calculated on the basis of the minimum wage);
• Private health insurance (cost: 150–350 zł per month; the scope of cover depends on the chosen package);
• Part-time employment or a contract for specific tasks with another company.

Pitfalls and risks – what to avoid?

Any attempts to set up ‘front’ companies – i.e. using uninvolved family members or acquaintances – are not only unethical but also illegal (Article 55 of the Fiscal Penal Code). The Social Insurance Institution (ZUS) and the tax authorities are becoming increasingly effective at detecting such practices, which can result in serious penalties for both parties. Similarly, actions such as fictitious employment abroad or entering into sham civil-law contracts that do not correspond to the economic reality carry a high risk.

Summary

Legally reducing ZUS costs requires not only knowledge of the regulations but also the ability to analyse various forms of business operation. A limited liability company (Spółka z o.o.) with two genuine shareholders, a Simple Public Limited Company (Prosta Spółka Akcyjna) without the provision of labour, unregistered business activity, or the use of tax reliefs and contribution holidays – each of these approaches has its advantages, but also its limitations.

It is worth making informed decisions when choosing a business structure, taking into account both your own business needs and the long-term tax and social security implications. Using the services of experienced legal and tax advisers helps to avoid mistakes that could prove costly.

There is no denying that the ZUS system, in its current form, does not encourage entrepreneurship. However, the wide range of legal instruments available makes it possible to significantly reduce the burden – without the risk of breaching the law. Reliability and transparency in one’s actions are key, as is a willingness to periodically update one’s strategy in response to changing legislation and case law.

Rather than treating ZUS optimisation as a ‘race against the authorities’, it is better to view it as part of the informed management of your business and your own financial security for the future. It is worth investing the funds saved – whether in business development or building a personal pension strategy – rather than passively funding an inefficient system.

If you are considering changing the legal form of your business or have any doubts about the current regulations, I recommend consulting an expert who can tailor a solution to the specific nature of your business – please feel free to contact the experts at the ‘Firma dla Każdego’ business incubator.