JDG or sp. z o.o. in 2027: when a company pays off in Poland

If you pay out the whole profit to yourself, a sp. z o.o. costs more at 2026 rates than a JDG on the flat tax: at a profit of 300 000 zł, taxes and contributions come to about 110 300 zł in the company and 85 400 zł in the JDG. The company starts to pay off when you keep most of the profit in the business (you then pay only 9% CIT) or when you want to separate your private assets from business risk.

Law as of 9 October 2026.

The figures use the rates in force in 2026. For 2027 the minimum wage is already known (4 950 zł, Dz.U. 2026 poz. 1213), but not all ZUS contribution bases are. The government's 2027 tax bill is described at the end as a bill, not as law in force.

Comparison in one table

Contribution amounts are for 2026 and exclude voluntary sickness insurance.

Liability

A JDG owner is liable for business debts with all their assets, including private ones. There is no separate business estate.

In a sp. z o.o. the shareholders are not liable for the company's obligations (art. 151 § 4 KSH). The protection is not complete:

• management board members are jointly liable for the company's debts if enforcement against the company fails and they did not file for bankruptcy in time (art. 299 KSH),
• board members are liable with all their assets for the company's tax arrears on similar terms (art. 116 § 1 Ordynacja podatkowa, Tax Ordinance).

The sole shareholder is usually also the board president, so limited liability protects them mainly when the company watches its liquidity and reacts to insolvency in time.

Taxes

JDG: three forms of taxation

• Tax scale (skala podatkowa): 12% minus a 3 600 zł tax-reducing amount up to 120 000 zł of income; above that 10 800 zł plus 32% of the excess (art. 27 ust. 1 of the PIT Act).
• Flat tax (podatek liniowy): 19% of income at any level (art. 30c ust. 1 of the PIT Act). You can deduct the health contribution up to 14 100 zł in 2026 (art. 30c ust. 2 pkt 2 of the PIT Act, notice of the Minister of Finance and Economy of 12 December 2025, M.P. poz. 1274).
• Ryczałt od przychodów ewidencjonowanych (lump-sum tax on recorded revenue): 2% to 17% of revenue with no cost deduction, for example 17% for liberal professions, 12% for some IT services and 8,5% for most other services (art. 12 ust. 1 of the Lump-Sum Tax Act). You can choose it if the previous year's revenue did not exceed 2 000 000 euro (art. 6 ust. 4 of that act).

Sp. z o.o.: CIT and dividends

The company pays 9% CIT if its revenue in the tax year did not exceed the equivalent of 2 000 000 euro (8 431 000 zł in 2026) and it is a small taxpayer, meaning its sales including VAT in the previous year did not exceed 8 517 000 zł. In the year the company starts, the small-taxpayer condition does not apply. Otherwise the rate is 19% (art. 19 ust. 1, 1d and 1e of the CIT Act).

The 9% rate does not apply in the first year of activity and the following year to a company created by converting a JDG, or to a company that received a previously run business or its assets worth over 10 000 euro (art. 19 ust. 1a of the CIT Act). This matters if you plan to move an existing business into a company.

When the company pays out profit, the shareholder pays 19% tax on the dividend (art. 30a ust. 1 pkt 4 of the PIT Act). Profit kept in the company is taxed with CIT only.

ZUS

JDG: contributions rise in stages

1. Ulga na start (start-up relief): for 6 months you pay no social contributions, only the health contribution (art. 18 ust. 1 of Prawo przedsiębiorców, the Entrepreneurs' Law).
2. Preferential ZUS: for the next 24 calendar months the base is at least 30% of the minimum wage, which is 1 441,80 zł. Social contributions without sickness insurance are 420,86 zł a month (art. 18a of the Social Insurance System Act).
3. Mały ZUS plus (small ZUS plus): if last year's revenue did not exceed 120 000 zł, the base depends on income. You can use it for at most 36 months in every 60 months of activity (art. 18c of that act).
4. Full ZUS: base 5 652 zł, social contributions 1 788,29 zł a month, or 1 926,76 zł with sickness insurance.

You cannot use the start-up relief or preferential ZUS if you ran a business in the last 60 months or work for a former employer in the same field.

The JDG health contribution depends on the tax form. On the tax scale it is 9% of income, on the flat tax 4,9% of income, in both cases at least 432,54 zł a month from February 2026 (art. 79 and 79a of the Health Care Benefits Act). On ryczałt you pay 498,35 zł, 830,58 zł or 1 495,04 zł a month, depending on annual revenue: up to 60 000 zł, up to 300 000 zł or above (art. 81 ust. 2f of that act).

Sp. z o.o.: the sole shareholder pays full contributions at once

The shareholder of a single-member sp. z o.o. is insured like a person running a business (art. 8 ust. 6 pkt 4 of the Social Insurance System Act). Start-up relief and preferential ZUS apply only to people running a business activity, so the shareholder pays 1 788,29 zł a month from the start.

The shareholder's health contribution does not depend on profit. In 2026 it is 830,58 zł a month, which is 9% of the average wage in the fourth quarter of 2025 (art. 81 ust. 2za of the Health Care Benefits Act).

If the company has at least two shareholders, holding shares alone does not create this obligation.

Accounting

An individual must keep full accounting books only when their net revenue for the previous year reached at least 2 500 000 euro (art. 2 ust. 1 pkt 2 of the Accounting Act). Below that, a JDG keeps the KPiR, or a revenue record on ryczałt.

A sp. z o.o. always keeps full accounting books (art. 2 ust. 1 pkt 1 of the Accounting Act). Each year it prepares financial statements, approves them within 6 months of the balance sheet date and files them with the KRS (art. 53 ust. 1 and art. 69 ust. 1 of that act). This means more work and usually higher accounting fees.

Set-up costs

Registering a JDG in CEIDG (the business register for individuals) is free (art. 13 of the CEIDG Act).

You can set up a sp. z o.o. with 5 000 zł capital through S24 for about 274 zł (250 zł court fee and 24 zł PCC, the civil law transactions tax) or at a notary for about 719 zł plus copies. The capital is paid in on top. Details are in our article on how to start a sp. z o.o., and you can work out your own costs in the company cost calculator.

Worked examples for three profit levels

Assumptions:

• profit means revenue minus costs, before tax and the owner's contributions,
• the JDG pays full ZUS without sickness insurance (21 459,48 zł a year), and the health contribution is simplified to 12 months at 2026 rates,
• the company has one shareholder, pays 9% CIT and pays out all profit after CIT as a dividend,
• the shareholder pays social and health contributions from personal money: 31 426,44 zł a year.

Total annual taxes and contributions:

How we calculate the 300 000 zł example

JDG, flat tax:

1. Social contributions: 21 459,48 zł. Income after deducting them: 278 540,52 zł.
2. Health contribution: 4,9% × 278 540,52 zł = 13 648,49 zł.
3. Tax base after deducting the health contribution (within the 14 100 zł limit): 264 892 zł.
4. PIT 19%: 50 329 zł.
5. Total: 85 436,97 zł.

Sp. z o.o., all profit as dividend:

1. CIT 9%: 27 000 zł. 273 000 zł is left to pay out.
2. Dividend tax 19%: 51 870 zł.
3. Shareholder contributions: 31 426,44 zł.
4. Total: 110 296,44 zł.

What the numbers show

• At low profit the JDG wins, because it has ZUS reliefs and no double taxation.
• When all profit is paid out, the company loses to a JDG on the flat tax at all three levels.
• The company wins when you reinvest the profit: with 600 000 zł kept in the business you pay 85 426 zł instead of 157 052 zł in a JDG on the flat tax.
• The tax scale pays off only at lower income, because above 120 000 zł the rate rises to 32%.

The examples leave out ryczałt, because its result depends on revenue and the rate for the specific service, not on profit.

The 2027 tax bill

The government has sent the Sejm a bill amending the PIT, CIT and lump-sum tax acts (print no. 3147, received on 29 September 2026, first reading on 6 October 2026). Among other things, the bill provides for:

• a PIT scale of 12%, 24% and 32% with thresholds of 130 000 zł and 150 000 zł,
• a lower revenue limit for ryczałt, from 2 000 000 euro to 250 000 euro,
• 22% CIT for businesses with revenue above 50 000 000 euro,
• entry into force on 1 January 2027.

This is a bill, not law in force. Its content can change in the Sejm and the Senate, and the law needs the President's signature. Do not choose your business form on the basis of the bill alone.

Frequently asked questions

At what profit does a sp. z o.o. pay off?

If you pay out all profit to yourself, at 2026 rates a JDG on the flat tax is cheaper at a profit of 120 000, 300 000 and 600 000 zł. The company pays off when you keep a large part of the profit in the business, because you then pay only 9% CIT.

How much ZUS does the sole shareholder of a sp. z o.o. pay in 2026?

Social contributions are 1 788,29 zł a month without sickness insurance, and the health contribution is 830,58 zł. The shareholder gets no start-up relief or preferential ZUS.

Will I pay 9% CIT after converting my JDG into a company?

Not at once. A company created by converting a JDG pays 19% CIT in its first year of activity and the following year (art. 19 ust. 1a of the CIT Act).

Am I liable for the debts of my sp. z o.o.?

As a shareholder, no. As a board member you can be liable with your own assets if enforcement against the company fails and you did not file for bankruptcy in time (art. 299 KSH, art. 116 of the Tax Ordinance).

Will the PIT thresholds and the ryczałt limit change from 2027?

Not yet. The government bill (print no. 3147) provides for a 12%, 24% and 32% scale and a 250 000 euro ryczałt limit, but it has not been passed.