Not every break in running a company has to mean closing it. If you temporarily have no orders, are planning a longer trip or are considering full-time employment, you can suspend your sole proprietorship (jednoosobowa działalność gospodarcza) instead of removing it from the register. A suspension entered in the CEIDG (the Polish business register) frees you for that time from ZUS contributions (social security) and tax advances, while the business stays ready to be resumed at any moment. We explain who may suspend their business, how to do it and what obligations to keep in mind.
Who can suspend a business and for how long
You can suspend an activity registered in the CEIDG under one basic condition — you do not employ workers under an employment contract (or on the basis of appointment, election, nomination or a cooperative employment contract). Mandate and specific-task contracts (umowa zlecenia, umowa o dzieło) are not an obstacle. If you have full-time employees, you must terminate their contracts before the suspension. An exception applies to people on maternity, parental or childcare leave.
The reason for suspension can be any, and you can suspend the business for a period of no less than 30 days — also indefinitely and any number of times. In the application you may immediately indicate a resumption date — the activity will then resume automatically — or leave the date open and resume the business when you are ready.
How to report the suspension
You report the suspension of a sole proprietorship only to the CEIDG — online at Biznes.gov.pl or at the municipal office using the CEIDG-1 form. You do not have to notify ZUS or the tax office separately; the CEIDG itself forwards the information to ZUS, the head of the relevant tax office and the Central Statistical Office (GUS). Based on this report, ZUS automatically prepares the documents deregistering you from insurance. The start date of the suspension may be earlier than, the same as, or later than the day you submit the application.
ZUS and health insurance during the suspension
Throughout the suspension you are not subject to ZUS insurance and pay no contributions — neither social nor health. It is worth planning the date carefully, though. If you suspend the business mid-month, you will pay the full health contribution for that month and social contributions in proportion to the number of days the activity was active.
Remember your health cover as well. The right to NFZ benefits (the state health fund) expires 30 days after health insurance ends. If during the suspension you have no other basis for insurance (e.g. a job or a mandate contract), it is worth voluntarily joining health insurance with the NFZ. You can also voluntarily join the old-age and disability pension insurance to avoid a gap — you cannot, however, pay sickness (chorobowe) or accident (wypadkowe) insurance.
Taxes, VAT and accounting
For the suspension period you pay no income tax advances or lump-sum tax (ryczałt) — regardless of the form of taxation. The exemption does not cover obligations that arose before the suspension, however: an advance on income earned before the break must be paid by the normal deadline. Importantly, suspension does not exempt you from the annual PIT return — you file it even if the business was suspended for the whole year and earned no income.
During the suspension you do not file JPK_V7 records. However, if you suspend the activity mid-month or mid-quarter, you must file a return for that settlement period. A suspension lasting at least 6 months results in removal from the register of active VAT taxpayers — after resumption you are re-registered automatically, without filing a VAT-R form. The obligation to keep accounts (PKPiR — the tax book of revenue and expenses — or a revenue ledger) remains, as does paying dues such as property tax or the tax on means of transport.
What you may do during the suspension
Suspension means you may not conduct business activity or earn current income from it. The law does, however, allow actions that protect the company: you may collect receivables from before the suspension, settle earlier liabilities, sell your own fixed assets and equipment, and secure sources of income. You also have obligations — among others, to take part in audits and proceedings concerning the company; fixed assets withdrawn from use stop being depreciated until the activity is resumed.