B2B in Poland for foreigners: how to open a JDG and what to watch out for

Some believe B2B is simply "an employment contract with lower taxes". It isn't. On B2B you stop being an employee: no paid holiday, no minimum wage, no protection against dismissal. You are a business invoicing another business. The higher take-home pay is the price for the risks you take on.

Which foreigners can open a JDG

A sole proprietorship (JDG) is not available with every document. Usually eligible are:

• holders of permanent residence or EU long-term resident status;
• holders of the Pole's Card;
• people with some types of temporary residence — for example, based on marriage to a Polish citizen;
• Ukrainian citizens with UKR status — under the special act, while it is in force.

A standard temporary residence permit for work with a specific employer usually does not allow a JDG.

Registration in CEIDG

The application is free and filed online. You enter an address, PKD activity codes, a tax form and a start date. Within a few days the business has NIP and REGON numbers. It's worth opening a separate business bank account — a personal one works too, but it's inconvenient for bookkeeping.

Tax form

• Lump sum (ryczałt) — tax on revenue without deducting costs. Most often 12% for programmers, 8.5% for many services. Good when you have almost no costs.
• Flat 19% — on profit, plus a separate 4.9% health contribution on profit. Pays off with high costs and high income.
• Tax scale 12% / 32% — with a tax-free amount of PLN 30,000 a year. Works well at the start with modest income.

An important limit: if you switched to B2B with your former employer and do the same work, the flat rate is not available to you that year.

ZUS: three stages

• Ulga na start — first 6 months: health contribution only.
• Preferential ZUS — next 24 months: about PLN 420 a month in social contributions plus health.
• Full ZUS — after that: about PLN 1,790 a month in social contributions plus health.

The difference between year one and year three exceeds PLN 1,700 a month. Plan your budget for full ZUS from the start.

What job ads don't mention

• Holiday — only if it is written into the B2B contract.
• Sick pay — only with the voluntary chorobowe contribution.
• Accountant — PLN 150–400 a month depending on the city and number of documents.
• VAT. Once you exceed the annual turnover limit, you'll have to register for VAT.
• Disguised employment. Fixed hours, a boss and one workplace are signs that let the tax office treat B2B as an employment contract.

Checklist before signing a B2B contract

• Document. Your basis of stay allows you to run a JDG.
• Comparison. Take-home pay on B2B in year three (with full ZUS) is higher than on an employment contract.
• B2B contract. It specifies paid days off, the notice period and penalties.
• Accountant. Found before the first invoice, not after.
• Safety cushion. Savings for at least 2–3 months in case of illness or contract termination.