Installment arrangement for entrepreneurs paying contributions for their employees

Entrepreneurs who are in a difficult financial situation and have already arrested in ZUS due to contributions for insurance of their employees, have the option of applying for an installment arrangement with ZUS.

The installment arrangement is the possibility of repaying the debt due to contributions in monthly installments, in a period agreed with the Social Insurance Institution.

Advantages of signing a contract with ZUS:

• from the day following the day on which the application for the distribution of the debt into installments is submitted, ZUS will cease charging interest and will only charge a prolongation fee. It is 50% of the default interest rate applicable on the date of signing the contract,
• ZUS will not enforce contributions,
• if enforcement proceedings have already been initiated, ZUS will suspend them after signing the contract.

What can be divided into installments?

Entrepreneurs paying contributions only for their own insurance have the option of paying in installments the arrears in respect of contributions for all types of insurance, with the exception of the contribution for voluntary sickness insurance, because failure to pay it results in deregistration from sickness insurance and the loss of the right to benefits in this respect - but it does not create debt.

Entrepreneurs paying contributions for their employees (and contractors) may spread the debt in installments for:

• social security contributions:

  • disability

  • sickness

  • accident

• contributions to the Labor Fund,

• contributions to the Guaranteed Employee Benefits Fund,

• contributions to the Bridge Pension Fund.

However, they cannot spread the debt in installments due to:

• pension insurance contributions,
• health insurance premiums.

Applying for an installment arrangement

In order to apply for an installment arrangement, you must pay your current contributions in a timely manner (if the activity is still conducted) and pay the debt enforcement costs with ZUS (if any). It is necessary to submit an application with justification.

The application must include:

• applicant's data,
• type of contributions, period of debt and amount due,
• debt repayment proposal - on what dates and amounts is to be regulated,
• reasons for ceasing or incomplete payment of contributions,
• information with justification indicating that it is not possible to settle the debt once,
• indication of the type of public aid the entrepreneur is applying for.

Depending on the form of business (legal person, commercial law company, civil law partnership, partnership or sole proprietorship), ZUS will require additional documents to be attached to the application, for example:

• financial statements for the last 3 financial years (balance sheet, profit and loss account, cash flow statement)
• excerpt from the book of revenues and expenses for the last 3 years
• current excerpt from the revenue and expense ledger for the current year
• excerpt from the income records for the last 3 years
• the current excerpt from the revenue records for the current year
• annual tax returns (e.g. PIT-36, PIT-28).

The application may be submitted in the following forms:

• in writing, by mail or in person at each ZUS unit,
• orally to the protocol (at the ZUS unit) - the protocol should be signed by a ZUS employee and the entrepreneur,
• electronically - with the help of the pue.zus.pl portal
• by phone; via the Call Center (COT). Importantly, to submit an application in this form, you must have a profile on the PUE platform.

Examination of the application

The Social Insurance Institution may leave the application unrecognized only if, despite the prior request, the entrepreneur has not completed the formal deficiencies in the application or has not paid contributions that cannot be divided into installments (pension and health insurance for employees).

The pension authority may also refuse to divide the amount due into installments in the following cases:

• when the entrepreneur does not pay the current contributions due after the date of submitting the application,
• when ZUS has a reasonable suspicion that the entrepreneur, when submitting the application, does not aim to repay the debt, but only tries to postpone the resulting consequences,
• when the entrepreneur fails to meet the repayment terms.

Termination of the contract

The contract for the distribution of debt into installments will be terminated when:

• the entrepreneur fails to meet the obligation to pay the current premiums in full (together with the interest due), the payment date of which fell on or after the date of the contract, for a period longer than 14 days from the date of their due date, and when the difference in premiums resulting from this exceeds the amount corresponding to the cost of the reminder,
• two installments (for all funds jointly) will not be paid, the maturity date of which has expired,
• installments are paid in part, with the total amount of underpayments exceeding 5% of the premiums due under the contract (including the prolongation fee),

• the liabilities covered by the agreement will not be paid within the last installment payment date resulting from the repayment schedule,
• new circumstances, unknown but existing on the date of signing the contract, will be revealed, which show that the entrepreneur has deliberately misled the Social Insurance Institution in order to obtain relief in repayment and avoid enforcement,
• in relation to the receivables not covered by the contract, with the consent of the Social Insurance Institution, enforcement proceedings were suspended due to the entrepreneur's obligation to pay the amounts not subject to relief, if he fails to meet the obligation to pay the above-mentioned amounts for a period longer than 14 days from the due date indicated in the decision on the suspension of enforcement proceedings ,
• the entrepreneur submits a written declaration of withdrawal from the contract.

Therefore, if, during the term of the installment agreement, the financial situation of the entrepreneur deteriorates, which may result in failure to comply with the provisions of the agreement, he should apply to ZUS to change the dates or amounts of installments or extend the repayment period. This should be done without waiting for further debts to arise, because the change in the terms of the contract may only apply to those debts whose payment deadline has not yet expired.