Financial support from the employment office for entrepreneurs

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When deciding to start his own business, a new entrepreneur should have his own start-up capital. In practice, it is not very common, and therefore there are a number of different forms of assistance on the market for people who are just starting their adventure in business. One of them is financial support from the employment office for the entrepreneur.

Poviat labor office and support for entrepreneurs

Employment offices exist not only to register unemployed people and lead to their professional activation, but also to help all those who want to be self-employed. They offer various forms of support, not only financial. However, it should be remembered that in the vast majority of cases, in order to receive help from the employment office, a number of important conditions must be met, including going through the appropriate administrative procedure.

Support for entrepreneurs offered by PUP is always public, i.e. the office announces who, when and on what conditions can benefit from specific assistance - this approach is to ensure equal opportunities for all future and current entrepreneurs. We should remember, however, that financial support from the employment office will not appear at the same time in all such institutions in Poland. Moreover, assistance is not offered very often, in practice it is only offered a few times per calendar year. Therefore, it becomes necessary to follow the information provided by employment offices on an ongoing basis, be it on their websites or on notice boards or in the press.

Financial support from the employment office

Financial assistance offered by PUPs can take various forms, but the most common ones include:

  • purchase of office equipment;

  • creating a new job in the enterprise;

  • costs related to the use of legal and accounting assistance by the entrepreneur;

  • promotion of the enterprise or its expansion, or change of industry.

Financial support from the employment office is most often in the form of a one-off, repayable or non-repayable subsidy. Depending on the offer of the PUP and the entrepreneur's capabilities, he receives a specific amount of money intended for starting the first activity or continuing the existing one. We should remember, however, that in no case should the sums received be used to pay social and health insurance contributions of the entrepreneur - if the employment office finds out about the improper use of the funds obtained, it will request the entire amount to be returned with interest.

Employment offices that offer assistance to entrepreneurs require the conclusion of an appropriate agreement, on the basis of which the appropriate funds are transferred. This applies to any type of support offered - PUP is ultimately a public institution and does not have its own funds (it uses money from the local government or from the state budget).

Financial support from the employment office for setting up your own business

The most popular form of financial support from the employment office is a subsidy to start your own business. It is entitled to a maximum value of 6 times the average salary in Poland. In February 2021, the amount of such remuneration was exactly PLN 5,568.75, which means that the subsidy in question may be granted up to PLN 33,412.15. In practice, subsidies for starting the first activity are quite large, amounting to several thousand zlotys.

In order to obtain a subsidy from PUP, you must submit an appropriate application, it is necessary to check the current status of offers with the competent employment office. Although each office offers this support at least once a year, the decisive factor here is the applicant's place of residence and the need to have:

  • the status of a person registered as unemployed in a given PUP;

  • a person seeking work and not remaining in any employment, and not performing any other gainful work (e.g. under a contract for a specific task or commission);

  • status of a guardian of a disabled person - however, this requirement is not obligatory in all cases.

An application for a one-off grant should contain an appropriate justification. The future entrepreneur must describe the type of planned activity, the date of its planned commencement, place of its performance and whether it has its own financial contribution. It is equally important to show what the ex officio money will be spent on - it may be, for example, the purchase of equipment necessary to conduct a specific activity, organization of a workplace for an additional person, payment of rent or utilities (but not social and health insurance contributions).

The deadlines and form of submitting applications are always marked on the websites of PUPs and notice boards located in front of the office. Applications are processed within 30 days of submitting the complete set of required documents. It is worth remembering that in the vast majority of cases, the applicant must submit a business plan - a detailed description of his activity together with an appropriate cost estimate taking into account the fees associated with running the enterprise for at least one year.

Applications should additionally include:

  • indication of the amount that the future entrepreneur wants to receive - of course, you need to check in advance what the current possibilities of the office are in this regard, i.e. how much in a given year is the maximum subsidy for setting up a business;

  • symbol of the type of activity subclass defined in accordance with the Polish Classification of Activities (PKD);

  • the specificity and schedule of expenses for the purchase of fixed assets, equipment, machinery, materials, goods, services and advertising materials and for the acquisition of premises;

  • the proposed form of securing the return of the subsidy - e.g. surety, pledge, promissory note.

The subsidy from the employment office is granted in a non-returnable form, provided, however, that the entrepreneur will run his business for at least 1 calendar year. If the business closes early, the office will ask you to reimburse the allocated amount and may charge you additional interest. Although the entrepreneur is obliged to run his business, he may suspend it, if necessary - then the employment office does not require the subsidy to be reimbursed.

It is worth noting here that from January 21, 2021, the condition of not conducting business activity for the last 12 months was abolished, if the termination of the activity performed so far took place during the period of the epidemic threat or epidemic state announced due to COVID-19, in connection with the occurrence of this state , and the subject of the planned economic activity is different from the completed activity.

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Financial support from the employment office for entrepreneurs

Another form of assistance offered by PUPs is co-financing for current entrepreneurs. Employment offices act here as intermediaries in dealing with formalities related to submitting applications for granting money from European funds. The money offered by the EU in this regard is really large, but in order to receive it, many, often rigorous, formalities must be completed.

Currently, the most popular form of support is anti-crisis assistance related to the COVID-19 pandemic. An entrepreneur may apply for co-financing from European funds (not to be confused with the Polish Anti-Crisis Shield) when the decrease in turnover amounts to:

  • at least 30% - co-financing of up to 50% of the minimum wage per month;

  • at least 50% - co-financing of up to 70% of the minimum wage per month;

  • at least 80% - co-financing of up to 90% of the minimum wage per month.

The decrease in turnover is calculated on the basis of 2 consecutive months in 2020 freely chosen by the applicant or consecutive 60 calendar days. They are compared with the same months in 2019 and recorded how much the company's income has decreased.

Unfortunately, the financial support in question is temporary and currently amounts to a maximum of 3 months. The government of any member state may, however, extend this time limit. Applications for subsidies from European funds should be submitted to the PUP competent for the place of business, it can also be done via the praca.gov.pl portal. Remember that receiving support obliges the entrepreneur to run his business for the period for which the money was granted (e.g. if the subsidy was granted for 2 months, you should run the business for at least 2 months from the date of obtaining the support, and you must not suspend such a business. activities).

Summary

Financial support from the labor office for entrepreneurs may take various forms, but the most popular ones are the subsidy for starting the first business activity and co-financing under the EU anti-crisis shield. In both cases, it is necessary to contact the locally competent PUP and submit an appropriate application within the prescribed period. Both subsidies are non-returnable, provided, however, that the entrepreneur will run his business for a specified period of time.