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Recent numerous tax changes have raised doubts about who is the PIT and ZUS contribution payer in particular cases. This article explains how the issue applies to a non-public educational institution.
An individual operating a sole proprietorship is the owner of non-public educational institutions that employ staff. In this case, there is doubt as to which entity – the owner or the particular institution – pays PIT advances and ZUS contributions on employee remuneration, including under whose NIP tax ID the PIT and ZUS settlements should be made.
PIT payer
Under Article 2(1–3) of the NIP Act:
Natural persons, legal persons and organisational units without legal personality which are taxpayers under separate acts are subject to registration obligations.
Entities other than those mentioned in paragraph 1 are also subject to registration obligations if they are taxpayers under separate acts, as are tax remitters.
Entities which pay insurance contributions under separate acts are also subject to registration obligations.
On the basis of these provisions, it must be determined who is the tax remitter and who pays insurance contributions.
- Under Article 8 of the Tax Ordinance, a tax remitter is a natural person, legal person or organisational unit without legal personality obliged under tax law to calculate and collect tax from the taxpayer and pay it to the tax authority by the required date.
- Under Article 31 of the PIT Act, natural persons, legal persons and organisational units without legal personality, hereafter called “workplaces”, are obliged as remitters to calculate and collect during the year income tax advances from people who receive income from those workplaces, including from service or employment relationships.
In other words, the PIT remitter is the workplace, that is, the entity employing staff (teachers / other employees) and paying them remuneration.
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A non-public institution as a workplace
Under Article 8(1) of the Education Law, a school or institution may be public or non-public. Within the meaning of Articles 13(6)(2) and 14(3)(6) of the Education Law, non-public schools and non-public kindergartens employ teachers. In non-public institutions (kindergartens, other forms of preschool education and non-public schools), teachers are employed under employment contracts in accordance with the Labour Code.
An employer is an organisational unit, even if it has no legal personality, or a natural person, if it employs staff (Article 3 of the Labour Code).
In view of the above, the employer is the non-public institution, for example a non-public kindergarten or school. Therefore, a non-public educational institution, as employer, must have its own NIP and acts as remitter of PIT advances on the remuneration of its staff.The kindergarten owner is not the employer of teachers / other people employed by the institution and therefore is not the PIT remitter.
Example
Individual ruling of 10 August 2021, no. 0111-KDIB3-2.4018.9.2021.1.MGO.
The authority stated:Two people taking over a kindergarten are not obliged under tax law to calculate and collect tax from the taxpayer and pay it to the tax authority by the required date.Since the employer in this case will be the kindergarten, under Article 2(2) of the above Act on the registration and identification of taxpayers and tax remitters, it must apply for a tax identification number as remitter of employees' income tax advances.
Given the cited provisions and the facts presented, including that the kindergarten will employ the staff, it is precisely the kindergarten, as employer obliged to calculate, collect and remit employees' income tax advances, that should apply for a tax identification number to use as income tax remitter.
In summary, we consider the remitter of PIT advances for employees (teachers) in a non-public educational institution to be that institution, which should have its own NIP.
However, since this issue may raise interpretive doubts for tax authorities, one may consider applying for an individual ruling to mitigate tax risk.
ZUS contribution payer
As with PIT, the ZUS contribution payer for employees will be the non-public educational institution – the employer, not its owner (an individual). The reasoning is the same as above.In addition, Article 4(2)(a) of the ZUS Act states:
- The contribution payer is the employer in relation to employees and people performing substitute service, as well as an organisational unit or individual in a legal relationship with another individual justifying that person's social insurance coverage, including while on parental leave or receiving maternity allowance, except for people whose maternity allowance is paid by the Institution.
However, I draw attention to the differing position of ZUS and the ordinary courts on this matter: in their view, the employer and ZUS contribution payer is the owner of the non-public institution rather than the institution itself.ZUS and the courts rely on the following provision:
- Article 8(6)(5) of the ZUS Act provides that a person conducting non-agricultural business activity includes a person running a public or non-public school, another form of preschool education, an institution or a group thereof under the provisions of the education system.
In such a situation, one must assume that the institution run by the applicant lacks organisational and property independence and does not employ workers in its own name. It is therefore not their employer. Both under the Labour Code and the social insurance system act, the employer is J. R. as an individual conducting non-agricultural business activity (see Supreme Court judgment of 14 June 2006, I PK 231/05, and Wrocław Court of Appeal judgment of 1 March 2017, III AUa 1286/16).I was also informed by the ZUS helpline that the contribution payer is the individual / owner of the non-public institution.In light of the above, ZUS may conclude that the owner of the non-public institution is responsible for paying ZUS contributions for employees. In my opinion, the matter is not unequivocal and requires deeper legal analysis (by a labour-law specialist).
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Summary
Conclusions
- The remitter of PIT advances for employees (teachers) in a non-public educational institution is that institution, which should have its own NIP.
- In our opinion, the non-public educational institution also pays ZUS contributions. However, it must be borne in mind that ZUS may find the owner responsible for paying employees' ZUS contributions. In my opinion, the matter is not unequivocal and requires deeper legal analysis.
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