Polish Deal ​​​– revolutionary changes to health insurance contributions

by Monika Spotowska

6 August 2021

We would like to draw your attention to the upcoming legislative changes promoted under the name of Polish New Deal. Major modifications are expected in respect of, among other things, calculation of health insurance contributions and those liable to that insurance.

Higher health insurance contributions for self-employed

Starting from 1 January 2022 sole proprietors will pay health insurance contributions of 9% of the actual income from their business.

For those who pay flat tax on recorded income, the health insurance contribution will amount to 1/3 of the due tax.

The tax burden on the self-employed will increase drastically especially as the contributions will not be tax-deductible. At present, sole proprietors pay flat rate contributions. The base for assessment of the contributions can also be deducted from tax.

New – health insurance contributions to be paid by management board members

Those who sit on management boards exclusively by virtue of an appointment letter will be expected to pay health insurance contributions. At present, no social or health insurance contributions are due on income from such functions. Once the Polish Deal comes into force, the fiscal burden on management board members will go up by 9%, and even up to 41% of their income.