Board member pay in a sp. z o.o. in 2026: appointment, job or contract

A management board member of a Polish sp. z o.o. can be paid under the appointment resolution alone (powołanie), an employment contract (umowa o pracę) or a management contract (kontrakt menedżerski). Pay under an appointment carries no social insurance contributions, only the 9% health contribution, so PLN 10,000 a month leaves PLN 98,760 net a year, against PLN 71,856.76 from the same budget spent on an employment contract.

Law as of 12 October 2026.

The choice affects contributions, tax, the company's costs and the board member's protection. Below you will find a comparison of the three forms, the steps for setting the pay, a worked example and the rules under Estonian CIT.

The three options at a glance

Legal basis: art. 6 ust. 1 pkt 1 and 4, art. 11 ust. 1 and 2 of the social insurance system act (ustawa o systemie ubezpieczeń społecznych); art. 66 ust. 1 pkt 35a and art. 81 ust. 8 pkt 11a of the act on publicly funded healthcare (ustawa o świadczeniach opieki zdrowotnej); art. 22 ust. 2 pkt 1 and ust. 9 pkt 5 of the PIT act; art. 203¹ and 210 § 1 of the Commercial Companies Code (KSH).

How to set board pay, step by step

1. Appoint the board member by a shareholders' resolution, unless the articles of association say otherwise (art. 201 § 4 KSH). Unless the articles say otherwise, the mandate expires on the day of the meeting that approves the financial statements for the first full financial year in office (art. 202 § 1 KSH).
2. Set the pay rules. A shareholders' resolution may set the rules, including the maximum pay and additional benefits (art. 203¹ KSH). With an appointment alone, put the amount in the resolution.
3. For an employment or management contract, the company is represented by the supervisory board or by a proxy appointed by a shareholders' resolution (art. 210 § 1 KSH). That body or person sets the pay in the contract (art. 203¹ KSH).
4. If the sole shareholder is also the only board member, a contract with the company requires a notarial deed (art. 210 § 2 KSH).
5. Register the board member for insurance. With an appointment, the company registers them for health insurance only (art. 75 ust. 17a of the healthcare act); with an employment or management contract, for social and health insurance.
6. Every month, withhold the PIT advance and contributions, and pay the advances by the 20th of the following month (art. 38 ust. 1 and art. 42 ust. 1 of the PIT act).
7. After year end, file the payer's annual return and send the board member an individual income statement (art. 38 ust. 1a and art. 42 ust. 1a and 2 of the PIT act).

Appointment: health contribution only

An appointment is not a title to social insurance under art. 6 ust. 1 of the social insurance system act. A person appointed who is paid for the role is, however, covered by health insurance (art. 66 ust. 1 pkt 35a of the healthcare act). The obligation runs from the day of appointment to the day of dismissal (art. 73 pkt 17b of that act).

The health contribution is 9% of the full appointment pay (art. 79 ust. 1 and art. 81 ust. 8 pkt 11a of the healthcare act). The company calculates it, deducts it from the pay and pays it over (art. 85 ust. 17a of that act).

The company also withholds a PIT advance: 12% of the pay less PLN 250 of deductible costs (art. 41 ust. 1 and art. 22 ust. 9 pkt 5 of the PIT act). The law does not reduce this advance by the tax-reducing amount. The board member claims it only in the annual return (art. 27 ust. 1 of the PIT act).

The price of this form for the board member: no pension contributions are paid and there is no right to sickness benefit from this title.

Employment contract: full contributions and employee protection

An employment contract requires work under the employer's direction (art. 22 § 1 of the Labour Code, Kodeks pracy). A board member on an employment contract has full contributions, sickness insurance, paid leave and a notice period. Dismissal from the board does not remove their claims under the employment relationship (art. 203 § 1 KSH).

In 2026 the employer adds 20.48% to gross pay at a 1.67% accident insurance rate. You can work out a specific amount with the employer cost calculator, and the employer's duties are covered in the cost of hiring an employee.

A sole shareholder cannot validly employ themselves in their own company. The Supreme Court held such a contract void (resolution of 8 March 1995, I PZP 7/95), because there is no subordination.

Management contract: contributions as for a mandate contract

Income from a management contract is a separate PIT source (art. 13 pkt 9 of the PIT act). The contract is a contract for services governed by the mandate rules. A board member on a management contract is therefore compulsorily covered by pension, disability and accident insurance (art. 6 ust. 1 pkt 4 and art. 12 ust. 1 of the social insurance system act). Sickness insurance is voluntary (art. 11 ust. 2 of that act).

A management contract gives freedom to set bonuses, severance pay and a non-compete clause. It does not give Labour Code protection. If the board member has another insurance title, such as a job at another company, the rules on overlapping titles decide the contributions (art. 9 of the social insurance system act).

Example: PLN 10,000 a month from the company's budget

Assumptions: the company can spend PLN 120,000 a year on the board member before CIT. The board member has no other income and is not insured as a sole shareholder. For the employment contract: PLN 8,300 gross a month, PIT-2 filed, 1.67% accident rate, no PPK. For the dividend, the company pays out its whole net profit. Year 2026.

How we calculate the appointment: PIT is 12% of PLN 117,000 (PLN 120,000 minus PLN 3,000 of costs) minus the PLN 3,600 tax-reducing amount. During the year the company withholds PLN 14,040 in advances, and PLN 3,600 comes back with the annual return. The pay is a cost for the company, so it pays no CIT on it.

The advantage of an appointment has a limit. Above PLN 120,000 of income taxed on the scale, each extra PLN 100 of appointment pay leaves about PLN 59 net (32% PIT and the 9% health contribution). A dividend leaves PLN 73.71 at 9% CIT and PLN 65.61 at 19% CIT. Dividends are covered in how to take money out of a sp. z o.o.

A sole shareholder also pays their own shareholder ZUS, described in ZUS for the sole shareholder. Social contributions paid on their own insurance are deducted from income in the annual return (art. 26 ust. 1 pkt 2 lit. a of the PIT act). The health contribution is paid separately for each title (art. 82 ust. 1 of the healthcare act).

Estonian CIT: a cap on pay

Under the lump-sum tax on company income (Estonian CIT), benefits to a shareholder can be hidden profit (ukryty zysk). Pay under an employment contract, appointment, mandate contract and management contract is not hidden profit up to a cap. The cap is five times the average monthly pay the company paid under these titles in the previous month, but no more than five times the average monthly wage in the enterprise sector (art. 28m ust. 4 pkt 1 of the CIT act).

The excess over the cap is hidden profit and is taxed under the lump sum. You can read more in Estonian CIT.

Frequently asked questions

Does a board member have to be paid?

The Commercial Companies Code does not require a board member to be paid. If an appointed board member draws no pay, they have no title to health insurance under art. 66 ust. 1 pkt 35a of the healthcare act.

Are ZUS contributions due on appointment pay?

No social insurance contributions are due, because an appointment is not among the titles in art. 6 ust. 1 of the social insurance system act. The 9% health contribution is due on the full pay.

Is board pay a deductible cost for the company?

Yes. Pay under an employment contract is a cost in the month it is due for, if the company pays it on time (art. 15 ust. 4g of the CIT act). Pay under an appointment or a management contract is a cost on the day it is recorded in the books (art. 15 ust. 4d and 4e of the CIT act).

Can a sole shareholder be the managing director on an employment contract?

Not validly. The Supreme Court held an employment contract between a sole shareholder and their company void (I PZP 7/95). A sole shareholder can be paid under an appointment, and a contract with the company then requires a notarial deed (art. 210 § 2 KSH).

What PIT advance applies to appointment pay?

The company withholds 12% of the pay less PLN 250 of deductible costs, without the tax-reducing amount (art. 41 ust. 1 of the PIT act). The board member works out the final tax in the annual return on the 12% and 32% scale.