Bankruptcy and pre-retirement benefits for entrepreneurs


Pre-retirement benefit is financial support for a person who has been included by the legislator in the group of people entitled to receive it. But what if the entrepreneur declares bankruptcy? Therefore, we answer the question whether such an entrepreneur is entitled to a pre-retirement benefit.

Pursuant to the provisions of the Act, such a benefit is payable under certain conditions. Namely, it is a person who, until the date of declaration of bankruptcy, has been conducting non-agricultural activity continuously and for a period of at least 24 months, within the meaning of the provisions of the Act on the social insurance system (Journal of Laws of 2019, item 300, as amended ), hereinafter referred to as "Act on the social insurance system" and for this period, she has paid social security contributions and by the date of bankruptcy she has reached the age of at least 56 - a woman and 61 - a man, and has a retirement period of at least 20 years for women and 25 years for men.

Pre-retirement benefits - requirements to be acquired

It follows from the above that the declaration of bankruptcy of the conducted activity is one of the necessary conditions for the acquisition of a pre-retirement benefit. It should be remembered that the mere cessation of business activity and deregistering it from the business activity records should be considered insufficient to meet this condition. It is necessary to have the title indicating the announcement of such activity, which is a court decision.

Bankruptcy is declared in relation to a debtor that has become insolvent, i.e. then has lost the ability to meet its due pecuniary obligations. It is presumed that the debtor has lost the ability to meet his due pecuniary obligations if the delay in the performance of pecuniary obligations exceeds three months.

The title of the declaration of bankruptcy is the decision on bankruptcy issued by the court, in which:

  1. lists the name and surname of the debtor (bankrupt) or his name, place of residence or registered office, address and PESEL number or the number in the National Court Register, and in the absence of these - other data enabling his unequivocal identification;

  2. calls on the bankrupt's creditors to report the claim within thirty days of the announcement of the bankruptcy order in the Register;

  3. calls on persons who have the rights and personal rights and claims on the property belonging to the bankrupt, if they have not been disclosed by an entry in the land and mortgage register, to report them within thirty days from the date of announcement of the bankruptcy decision in the Register under pain of losing the right to rely on them in bankruptcy proceedings;

  4. appoints the judge-commissioner and the deputy judge-commissioner and the receiver;

  5. means the time of issuing the decision, if the bankrupt is a participant governed by Polish law or the law of another Member State of the payment system or the securities settlement system within the meaning of the act referred to in Art. 22 sec. 1 point 4, or a non-participant entity operating an interoperable system within the meaning of this Act.

Indications of the judicial decisions

The judicature emphasizes that pre-retirement benefits constitute a bridge between the period of employment and obtaining a retirement pension. Therefore, it is important to interpret the legislator's intention directly, which means that even if the entrepreneur was insolvent and bankruptcy has not been announced, the condition referred to in Art. 2 (3) of the Act on pre-retirement benefits.

The legislator provided for another condition related to the debtor's insolvency (cf. Art. 10 and Art. 11 BCE). The assessment of whether such a state actually exists may take place only after filing a bankruptcy petition.

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Additional Benefit Criteria

In addition, if the former entrepreneur has met the condition of bankruptcy, the following criteria are still required:

  • it is about the period of business activity before bankruptcy;

  • payment of social security contributions;

  • reaching the appropriate age.

The legislator requires that the bankrupt entrepreneur, before the bankruptcy declaration date, conducts non-agricultural activity continuously and for a period of not less than 24 months.

As emphasized in the jurisprudence:

"An indispensable condition for acquiring the right to pre-retirement benefit by a person conducting business activity in respect of which the bankruptcy has been declared is" payment of social security contributions "for the period of at least 24 months of activity. The right to pre-retirement benefits arises only in relation to the person who has paid the due insurance premiums to the pension body. It is not enough that such a person is "insured" and that he should pay contributions by law. Only non-arrears with contributions to the disability pension body create entitlement to pre-retirement benefits ”.

An entity that may acquire the right to a pre-retirement benefit, pursuant to Art. 2 clause 1 of the Act on pre-retirement benefits may be a "person"; woman or man. Therefore, the right to pre-retirement benefits cannot be acquired by a legal person or an organizational unit without legal personality. Moreover, this right serves to obtain regular means of subsistence for people who will soon be entitled to a retirement pension. Such a benefit may be granted by the pension authority only to a natural person.

Persons applying for the right to pre-retirement benefits pursuant to Art. 2 clause 1 point 3 of the Act on pre-retirement benefits should, by the date of declaration of bankruptcy, reach the age of at least 56 for women and 61 for men. Moreover, these persons should, until the date of declaration of bankruptcy, have a period entitling to a retirement pension of 20 years for women and 25 years for men.

To sum up, an entrepreneur / natural person who has run a business and later declared bankruptcy as a result of insolvency, has the possibility to apply for a pre-retirement benefit, and has the right to obtain it after meeting the above-mentioned conditions.

Legal basis:

  • art. 2 clause 1 point 3 of the Act of 30 April 2004 on pre-retirement benefits (Journal of Laws 2019.2173, i.e.);

  • Act of February 28, 2003, Bankruptcy Law (Journal of Laws 2019.498, i.e.).