On December 11, 2024, the Polish Supreme Court, in Case No. II NSNc 267/24, upheld an extraordinary appeal filed by the Commissioner for Small and Medium Enterprises. The court overturned the judgment of the Court of Appeals in Rzeszów concerning the calculation of social security contributions for a self-employed individual. The Commissioner argued that ZUS (the Polish Social Insurance Institution) had no legal basis to challenge the declared contribution base, particularly in the case of an entrepreneur who increased the contribution base in the first month of business activity, specifically in July 2018.
A Significant Victory Amid Conflicting Precedents
This ruling carries exceptional weight, as it contrasts with a previous Supreme Court resolution from November 29, 2023 (Case No. III UZP 3/23), which allowed ZUS to verify contribution bases during the initial months of business operations, even without disputing the legitimacy of the business itself. However, the November 2023 resolution acknowledged that, starting in January 2016, new optimized algorithms for calculating benefits had been introduced by legislators to prevent potential abuses related to inflated contribution bases. The Commissioner referenced this legislative shift in the extraordinary appeal, emphasizing that the 2023 resolution should not apply to cases where entrepreneurs raised their contribution bases after January 1, 2016.
The Supreme Court’s Consistent Position
The Commissioner also highlighted the enduring relevance of the Supreme Court’s resolution from April 21, 2010 (Case No. II UZP II 1/10), which stipulates that ZUS cannot challenge an entrepreneur’s declared contribution base if it does not contest the legitimacy of the business. This recent victory confirms that ZUS lacks the authority to reduce the declared contribution base, even in the first month of business activity, provided the base was increased after 2015 and the legitimacy of the business is not in question.
First Win Following a Pivotal 2023 Resolution
“This marks the first successful extraordinary appeal since the November 29, 2023, resolution, involving a case where the entrepreneur raised the contribution base in the initial month of business activity,” noted Agnieszka Majewska, the Commissioner for Small and Medium Enterprises. She added that similar appeals had succeeded in other contexts, but this particular win sets an important precedent.
Implications for Entrepreneurs
This ruling strengthens the position of entrepreneurs, ensuring greater clarity and protection regarding social security contributions in the early stages of business activity. It highlights the importance of the 2016 algorithmic adjustments and reaffirms that ZUS cannot retroactively challenge declared contribution bases when the business’s legitimacy is undisputed.
Source: Manager Plus
