[Poland] Entrepreneur’s health contribution in 2023

The health insurance contribution is one of several monthly fees paid by entrepreneurs to the Social Insurance Institution (ZUS). Against which base is it calculated and when must it be accounted for in 2023?

Health contribution – the minimum amount

As from 2022, the amount of the health contribution depends on the form of taxation and the amount of income earned. In principle, the minimum amount of the health contribution for an entrepreneur settling PIT on the general basis, i.e. according to the tax scale, is 9% of the contribution assessment basis, i.e. the income from business activity.

The minimum health contribution assessment basis for the time period from February 2023 to January 2024 is PLN 3 490 (minimum pay from January 2023) andthe minimum contribution amount is PLN 314.10 (read also: Minimum remuneration in 2023).

It is important to note that there will be no further increase in the minimum contribution amount for health insurance with the second increase in the minimum pay from 1 July 2023. The minimum contribution assessment basis indicated above will apply from February 2023 until January 2024 (for January 2023, there is still a minimum contribution amount of PLN 270.90, which is 9% of the contribution assessment basis of PLN 3 010).

The amount of the entrepreneur’s health insurance contribution depends also on the form of taxation:

1. 19% flat tax – health contribution of 4.9% of the contribution assessment basis (business income),

• Tax scale – contribution of 9% of the contribution assessment basis (business income),

• Lump sum on registered income – the monthly health contribution is 9% of the flat rate base and, depending on income, will amount to:

Contribution of PLN 376.16 for revenue below PLN 600 000;

Contribution of PLN 626.93 for revenue up to PLN 300 000;

Contribution of PLN 1128.48 for revenue above PLN 300 000;

• Tax card – the assessment basis for the health insurance contribution is the minimum remuneration in force in a given year and the health contribution, for each month of the year of contributions, from 1 February 2023 to 31 January 2024, amounts to PLN 314.10.

Annual settlement of the entrepreneur’s health contribution in 2023

From 2022, entrepreneurs are required to settle their health contribution annually. What does it look like? We explain below.

The annual settlement of the entrepreneur’s health insurance contributions involves the application of the annual health contribution assessment basis representing the income from business activities for the calendar year treated as the difference between revenues and the costs of obtaining such revenues, reduced by contributions for pension, disability, sickness and accident insurance, if they have not been included in the tax deductible costs.

An entrepreneur settling on the general rules (according to the tax scale) or a flat tax will apply the minimum annual contribution assessment basis if the annual contribution assessment basis turns out to be lower than the multiplication of the number of months subject to health insurance and the minimum remuneration.

Entrepreneurs are to submit their annual health contribution settlement on the document for April 2023 using the following template:

• ZUS DRA (block XII), “Annual settlement of health insurance contributions if lump-sum taxation on registered income is applied” – for a payer making contributions solely for himself,
• ZUS RCA (block III.F), Annual settlement of health insurance contributions if lump-sum taxation on registered income is applied”. – for payers of contributions employing up to 5 employees,

by 22 May 2023.

Calculation of the amount of contribution refund or surcharge – ZUS calculator

While making an annual settlement, one may find that:

• the insured person has paid higher health insurance contributions than the annual health insurance contribution calculated upon the annual health contribution assessment basis – then the overpayment is returned,
• the amount of contributions paid by the insured person is lower than the annual contribution, then it is necessary to pay the difference.

In order to make the calculation easier, ZUS has provided a special calculator for determining the annual assessment basis and health insurance contribution for persons engaged in non-agricultural economic activities.

The ZUS calculator will help calculate the annual assessment basis and contributions:

• for persons conducting one or more non-agricultural business activities to which the following forms of taxation apply: general rules (scale tax, flat tax) and lump-sum tax on registered income,
• for persons benefiting from the ‘relief for a start’, ‘preferential contributions’ and ‘small ZUS plus’.

The calculator will also determine the difference between the annual health insurance contribution and the sum of the monthly contributions due, which will form the basis for determining the total amount of the contribution refund or surcharge.

Entrepreneur pays health contribution for himself – exceptions to the rule

Generally, an entrepreneur pays the health insurance contributions for herself/himself, but not always, there are some exceptions to the rule. Here are the cases in which the entrepreneur does not have to pay the health contribution for herself/himself:

• an entrepreneur is a pensioner whose pension does not exceed the minimum monthly remuneration, paying income tax on business activity in the form of a tax card;
• an entrepreneur is a person with a moderate or severe disability who pays income tax on his or her business activity in the form of a tax card;
• an entrepreneur is a pensioner or disability pensioner whose pension does not exceed the amount of the minimum monthly remuneration and whose monthly business income does not exceed 50% of the amount of the minimum pension;
• an entrepreneur receives maternity benefit not exceeding the amount of parental benefit per month;
• an entrepreneur is a person with a moderate or significant degree of disability, who receives monthly income from his/her activity in an amount not exceeding 50% of the amount of the lowest pension;
• an entrepreneur is an employee and pays contributions at a rate no higher than the minimum remuneration, who receives monthly revenue from his/her activity in an amount not exceeding 50% of the minimum remuneration and pays income tax in the form of a lump sum on registered revenue.

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