With shield or dead on shield? A few words about the solutions of the anti-crisis shield in Poland.
Parliament adopted the act amending the act on special solutions related to the prevention, counteracting and combating of COVID-19, other infectious diseases and the resulting crisis and some other acts. The Senate will discuss it on March 30, 2020, and according to the assumptions of the Council of Ministers, the act should come into force on April 1, 2020. Economists, entrepreneurs and employers' associations speak of the amendment at most as a "paper shield", and not solutions with proportional to achieving the intended effect, inadequate to the seriousness of the situation and simply ... insufficient to protect the Polish economy from collapse. Below is an overview of some of the solutions adopted by Parliament. 1. Social Security contributions The bill provides for the possibility of applying for exemption from paying Social Security contributions for self-employed and micro-entrepreneurs (up to 9 employees). 2. Downtime benefit Downtime benefits for persons running a sole proprietorship (sole trade), also for natural persons who are parties to contracts based on civil law contracts (not labor law). In Poland, they are work-specific contracts and commission contracts that include natural persons. The benefit is to take the form of a one-off payment for persons conducting sole proprietorship and for persons employed under civil law contracts. The condition for its granting is to be 'economic downtime' caused by the epidemic, lasting at least 30 days before the month in which the application for payment of such benefit is submitted. The amount of the benefit will be 80% of the minimum wage in 2020, i.e. PLN 2,080, and will not be subject to Social Security contributions or taxation. Importantly, the benefit can be obtained if the applicant does not have another social security title. A detailed discussion can be found in our article at https://www.prawowczasachkoronawirusa.pl/post/śszenie-postojowe-w-związku-z-covid-19-w-polsce 3. Loan for micro-entrepreneurs Micro-entrepreneurs operating before March 1, 2020 will be able to apply for a loan of up to PLN 5,000 for a maximum period of 12 months. The rules for this assistance provide for a fixed interest rate, and repayment can take place after a six-month grace period. The loan is to cover the current costs of doing business for micro-entrepreneurs. The loan will be subject to amortization together with interest if, within 3 months of its granting, the entrepreneur does not reduce the number of full-time employees compared to February 29, 2020. 4. State support for employee remuneration
The state plans to subsidize part of the costs of employees' remuneration and due contributions for compulsory insurance paid on these remuneration, the assistance will also be self-employed without employees. This form of assistance is to be provided when the activity carried out shows a decrease in turnover, which is defined in detail in the Act. Briefly, this will be understood as a reduction in the sale of goods or services in quantitative or value terms, calculated as the ratio of total turnover in any two subsequent calendar months indicated in the period after January 1, 2020 to the day preceding the day of submission of the grant application , compared to the total turnover from the corresponding 2 consecutive calendar months of the previous year; a month is also considered to be 30 consecutive calendar days in a row, if the two-month comparative period begins during a calendar month, that is on a day other than the first day of a given calendar month. The very definition of a decrease in turnover, as you can see, is complicated. The support will cover only part of the employee remuneration costs and contributions due. It is up to the entrepreneur himself whether he will apply for co-financing the salaries of all employees or only some of them.
How much funding the entrepreneur receives will depend on the level of turnover decline - the solution provides for a proportional increase in the funding depending on the amount of turnover decrease in percentage.
Co-financing may be granted for a period not longer than 3 months and will be paid on a monthly basis after submitting a statement on the employment of employees as at the last day of the month for which the co-financing is to be paid. The entrepreneur benefiting from co-financing must keep in employment the employees covered by the co-financing for its period and the period corresponding to it. Otherwise, he will be forced to return the grant.
5. Support for self-employed people On the other hand, co-financing of entrepreneurs not having employees will cover only a part of the costs of conducted activity, and its amount will depend on the percentage of turnover decreases - with a decrease of 80% and more, the entrepreneur will receive 90% of the minimum remuneration for work. In the case of a smaller decrease in turnover, these amounts will be correspondingly lower. It should be remembered that each aid has its drawbacks - the entrepreneur will be obliged to continue operating for the period for which the grant has been granted, and failure to comply with this condition will result in the need to return the received grant in an amount proportional to the period of not conducting business activity. The procedure will take place at the local level - applications should be submitted to poviat labor offices within 14 days of announcing the recruitment by the director of the poviat labor office. When will the recruitment be announced? This is not known, the Act does not contain any information in this regard. 6. Renegotiation of the terms of the small and medium-sized enterprise loan with the bank The amended provisions are to allow modifying the terms and financing of loans granted to micro, small or medium-sized enterprises. All changes are to be made on the basis of mutual arrangements between the entrepreneur and the bank and, as a rule, may not worsen the situation of the borrower. The above regulation applies only to borrowers who had concluded contracts before March 8, 2020 (entry into force of the first counteracting act on COVID-19), and the change in the terms of the loan is justified by the assessment of the financial and economic situation as at no earlier than September 30, 2019. . 7.Possibility to submit annual tax declarations regarding personal income tax by May 31, 2020? Taxpayers of personal income tax may file a tax declaration simultaneously with the payment of the tax due until May 31, 2020. However, this is not automatic top-down. Performing this activity after April 30, 2020, but before the end of May is treated as an 'active regret' in which the taxpayer admits that he has not fulfilled his tax obligation (i.e. he has committed a tax offense or a fiscal offense), but he is not punishable because it notifies about this and performs the tax obligation. 8. Extension of legal stay and work permits - foreigners Pursuant to the provisions, residence visas and temporary residence permits for foreigners will be extended, as well as the deadline for submitting applications for residence permits, visa extension and extension of visa-free travel if it falls during an epidemic or epidemic state. The periods of validity of temporary residence permits and national visas will be extended by law up to 30 days from the date of cancellation of this state. 9. Real beneficiary It is planned to postpone until July 13, 2020 the deadline for entrepreneurs to fulfill the obligation to submit information to the Central Register of Real Beneficiaries (Act on counteracting money laundering). 10. Court deadlines In accordance with the content of the proposed changes during the period of epidemic threat or the state of epidemic announced due to COVID-19, the running of procedural and judicial deadlines in proceedings including court and enforcement proceedings, as well as proceedings and controls carried out pursuant to the Act of 29 August 1997 - Tax Code, does not start, and commenced suspension for this period. ... and other solutions
The solutions adopted in the Anti-Crisis Shield to support entrepreneurs are subject to numerous requirements, which are also followed by a large number of formalities and the effect of aid that is postponed and often uncertain. Many of the changes postulated in social dialogue were not taken into account.
Nevertheless, it is worth applying for appropriate, available assistance, which as such may help to survive the economic downtime stage.