- In a sole proprietorship (JDG), you are personally liable for the company's debts with all your assets, including your home and savings, and in certain situations, joint assets with your spouse.
- In a limited liability company (LLC), shareholders are generally not liable for the company's debts (Article 151 § 4 of the Commercial Companies Code). This is real protection, but not unconditional.
- There are five main exceptions to this protection: liability of a board member (Article 299 of the Commercial Companies Code), late bankruptcy application, overdue taxes and ZUS contributions (Article 116 of the Tax Ordinance), personal guarantees and promissory notes, and three years after converting a JDG into an LLC (Article 584¹³ of the Commercial Companies Code).
- The most important defense for a CEO is a bankruptcy application or opening restructuring at the right time. The deadline for filing for bankruptcy is 30 days from the day the company became insolvent.
- Transferring assets to family when debts are already present or imminent is ineffective against creditors and may be a crime.
"Set up a company, and no one will touch your house" – this statement is often heard and is only partially true. A limited liability company does indeed separate the company's assets from the owner's assets. However, the law provides situations where a creditor can reach the personal assets of a shareholder or board member. This guide explains how this protection works, where its gaps are, and what you can legally do to benefit from it.
This guide describes Polish law as of October 23, 2026. Each regulation is provided with an article number and a link to the consolidated text in the sources table at the end. Where we cite court interpretations or market estimates, we clearly indicate this.
Example: A Construction Company That Stopped Paying Suppliers
Imagine a company performing finishing works. The investor did not pay for a large stage of work, the company lost liquidity, and stopped settling invoices with the building materials wholesaler. The wholesaler wins the case in court and directs the judgment to the bailiff. What happens next depends on the form in which the company operates.
| Variant | What the wholesaler can do |
|---|---|
| The company is a JDG owned by Mr. Adam | The bailiff conducts enforcement against all of Mr. Adam's assets: accounts, car, apartment. If the debt was incurred with the wife's consent, the creditor can, after obtaining an enforceability clause, also reach the joint assets of the spouses. |
| The company is a limited liability company (LLC), and Mr. Adam is only a shareholder | The enforcement concerns only the company's assets. Mr. Adam's private assets are generally out of reach unless he personally guaranteed the debt or signed a promissory note. |
| The LLC, Mr. Adam is a shareholder and CEO, enforcement from the company has proven ineffective, and the bankruptcy application was not filed on time | The wholesaler can sue Mr. Adam personally based on Article 299 of the Commercial Companies Code. If he does not demonstrate any of the statutory circumstances relieving him, he will be liable for the debt with all his assets. |
This example shows the most important difference: a shareholder and a board member are two different roles. In small companies, these roles are usually held by the same person, so the protection "from the company" is weaker than it seems.
What Does “Limited Liability” Really Mean?
A limited liability company is a legal entity. It has its own assets, its own debts, and is responsible for them itself. The Commercial Companies Code states explicitly: shareholders are not liable for the company's obligations (Article 151 § 4 of the Commercial Companies Code). Therefore, a shareholder risks generally only what they contributed to the company, i.e., their share capital.
However, this rule does not apply to board members when the company is insolvent, nor to anyone who personally secured the company's debts. See how these two roles differ:
| Role | Personal Liability | Basis |
|---|---|---|
| Shareholder | Generally for nothing beyond their contribution. Exceptions: personal guarantees, promissory notes, mortgages, debts from JDG for 3 years after conversion, own torts. | Article 151 § 4 of the Commercial Companies Code |
| Board Member (CEO, Vice President) | For the company's debts when enforcement from its assets is ineffective, and the bankruptcy or restructuring application was not filed on time. For tax arrears and ZUS contributions on similar grounds. For damages caused by actions contrary to law. | Articles 299 and 293 of the Commercial Companies Code, Article 116 of the Tax Ordinance, Article 31 of the Social Insurance System Act |
Check Your Situation
The following flowchart guides you through the key questions a creditor or their lawyer would ask. It is educational in nature: simplified answers do not replace document analysis, and each result shows what is worth checking with a lawyer.
Can a company's creditor reach your personal assets?
What form does the company operate in?
You are liable with all your assets
In JDG, the company and you are the same person. The creditor can enforce against your accounts, car, and real estate. They will reach joint assets with your spouse if the spouse agreed to incur the debt, and for debts from business, also from the enterprise belonging to the joint property (Article 41 of the Family and Guardianship Code, Articles 787 and 787¹ of the Civil Procedure Code).
To check with a lawyer: marital property regime, business liability insurance, whether a company makes sense given your risk scale.
You are personally liable, but in different ways
Partners in a civil partnership are jointly and severally liable without order – the creditor can immediately demand payment from any of them (Article 864 of the Civil Code). A partner in a general partnership and a general partner in a limited partnership are liable with all their assets, but subsidiarily: enforcement against their assets is possible only when enforcement against the company's assets proves ineffective (Articles 22 § 2 and 31 of the Commercial Companies Code). A limited partner is liable only up to the amount of the limited partnership contribution, and the contribution released them in this regard (Articles 111 and 112 of the Commercial Companies Code).
What role do you play in the company?
Have you personally signed a guarantee, promissory note, mortgage on your property, or joined the company's debt?
You are liable within the limits of what you signed
Personal security is your own obligation to the bank, lessor, or supplier. The limited liability of the company does not affect it. A promissory note guarantor is liable just like the one they guaranteed (Article 32 of the Promissory Note Law).
To check with a lawyer: the content of contracts, promissory note declarations, limits on guarantees, whether the security has expired.
Did the company arise from the conversion of your JDG within the last 3 years, and does the debt originate from the period before the conversion?
You are jointly liable with the company
For 3 years from the date of conversion, the former owner of the JDG is jointly liable with the company for the company's debts incurred before the conversion (Article 584¹³ of the Commercial Companies Code). Debts incurred by the company thereafter burden only the company.
Generally, your private assets are protected
As a shareholder, you are not liable for the company's debts (Article 151 § 4 of the Commercial Companies Code; for PSA Article 300¹ § 4 of the Commercial Companies Code). Exceptions worth asking a lawyer about: receiving assets from the company to the detriment of creditors (Paulian action), own torts, tax arrears in certain forms and situations.
What debt is the matter about?
Has enforcement from the company's assets proven ineffective?
For now, Article 299 of the Commercial Companies Code does not apply
Liability of a board member requires ineffective enforcement from the company's assets. However, if the company is experiencing liquidity problems, this is the moment to check whether it already meets the criteria for insolvency and whether the 30-day deadline for filing for bankruptcy is running.
Was a bankruptcy application or restructuring opened in a timely manner (or was a settlement approved)?
You have statutory defense
A board member will be released from liability if they prove that a bankruptcy application was filed in a timely manner or that restructuring was opened or a settlement was approved during that time (Article 299 § 2 of the Commercial Companies Code). The burden of proof rests on you, so keep documents: application dates, reports, correspondence.
You are at risk of personal liability under Article 299 of the Commercial Companies Code
You are jointly liable for the company's debts incurred during your term with all your assets. There are two defenses left: proving that the failure to file the application was not your fault, or that the creditor did not suffer damage (Article 299 § 2 of the Commercial Companies Code). The creditor must sue you in a separate process.
To check with a lawyer: when exactly the company became insolvent, when the debt arose, whether restructuring is still possible.
Did the payment deadline for the arrears fall during your term, and has enforcement from the company's assets proven ineffective?
The tax office or ZUS may issue a decision on your liability
Board members are jointly liable with all their assets for the company's tax arrears (Article 116 of the Tax Ordinance), and ZUS applies this provision to contributions (Article 31 of the Social Insurance System Act). Defenses: timely bankruptcy or restructuring application, lack of fault, or indicating company assets from which arrears can be satisfied to a significant extent. A decision can be issued within 5 years (Article 118 of the Tax Ordinance).
This arrears generally do not burden you
Liability under Article 116 covers arrears whose payment deadline expired during your term. For arrears from other periods, those who were in the board at that time are liable. However, it is worth checking whether enforcement does not end up ineffective later.
Exception 1: Liability of a Board Member under Article 299 of the Commercial Companies Code
This is the most important provision for owners of small companies. If enforcement against the company proves ineffective, board members are jointly liable for its obligations (Article 299 § 1 of the Commercial Companies Code). In practice, the creditor first obtains a judgment against the company, directs it to the bailiff, and when the bailiff finds no assets, sues the board members personally.
When a Board Member is Released
Article 299 § 2 of the Commercial Companies Code provides three relieving circumstances. The board member must prove them:
- A bankruptcy application was filed in a timely manner, or a decision was made to open restructuring proceedings or approve a settlement during that time,
- The failure to file the bankruptcy application was not their fault,
- Despite the failure to file the application, the creditor did not suffer damage.
How Courts Interpret the Provision
The following theses come from resolutions of the Supreme Court. This is an interpretation, not the content of the law, but courts commonly adhere to it:
- Liability under Article 299 of the Commercial Companies Code is compensatory, and the claim is subject to a statute of limitations according to the principles for torts (resolution of 7 judges of the Supreme Court of November 7, 2008, III CZP 72/08).
- Those who were board members at the time of the obligation's existence are liable (resolution of the Supreme Court of February 28, 2008, III CZP 143/07).
- Liability also covers obligations arising after the grounds for declaring bankruptcy have occurred (resolution of the Supreme Court of November 25, 2003, III CZP 75/03).
- It also includes litigation and enforcement costs as well as interest (resolution of the Supreme Court of December 7, 2006, III CZP 118/06).
Important note: The Constitutional Tribunal ruled (judgment of April 12, 2023, P 5/19) that Article 299 of the Commercial Companies Code is unconstitutional in that it does not allow a former board member to defend against the allegation that the debt does not exist if the judgment against the company was issued in a case initiated after their departure from the board.
A Shareholder is Not a Board Member
Article 299 of the Commercial Companies Code applies only to board members (and liquidators – Article 299¹ of the Commercial Companies Code). A shareholder who is not on the board is not liable under this provision. In a simple joint-stock company, a similar liability for board members is provided for in Article 300¹³² of the Commercial Companies Code.
Exception 2: Late Bankruptcy Application
The key question regarding Article 299 of the Commercial Companies Code is: when was the “right time” for the bankruptcy application? The Bankruptcy Law provides the answer.
| Issue | What the law says | Provision |
|---|---|---|
| When is a company insolvent | When it has lost the ability to meet due monetary obligations or when its obligations exceed the value of its assets for a period longer than 24 months | Article 11(1) and (2) of the Bankruptcy Law |
| Presumption of insolvency | Delay in payment of obligations exceeding 3 months | Article 11(1a) |
| Deadline for application | No later than 30 days from the day the grounds for declaring bankruptcy arose | Article 21(1) |
| Compensation | Anyone who fails to file an application on time is liable for damages; it is presumed that the damage is the amount of the unsatisfied claim | Article 21(3) and (3a) |
| Prohibition on conducting business | The court may impose a ban on conducting business and holding positions in companies for 1–10 years | Article 373 |
| Criminal liability | Failure to file an application against the obligation: fine, restriction of liberty, or imprisonment for up to one year | Article 586 of the Commercial Companies Code |
A bankruptcy application is not the only route. If the company has a chance to recover, the board can instead opt for restructuring proceedings. Opening or approving a settlement in a timely manner also protects against Article 299 of the Commercial Companies Code. It is advisable to make this decision with a restructuring advisor before the 30 days elapse.
Could the company already be insolvent?
Is the company paying due monetary debts on time?
The presumption does not yet apply, but insolvency may already exist
The statutory presumption begins after 3 months of delay, but insolvency means losing the ability to pay due debts regardless of that presumption. Prepare a summary of obligations and real inflows and discuss it with a restructuring advisor. Record the date and conclusions from this analysis.
The law presumes that the company is insolvent
A delay longer than 3 months triggers the presumption of insolvency (Article 11(1a) of the Bankruptcy Law). From the day the grounds for bankruptcy arose, a 30-day deadline for application runs. Every day of delay increases the risk of personal liability for the board. Contact a lawyer or restructuring advisor immediately.
Do the company's obligations exceed the value of its assets?
Warning signal
The statutory "balance" premise requires exceeding for more than 24 months. Negative equity is a signal that liquidity should be monitored and corrective actions considered. For an LLC, a loss exceeding the sum of reserve and supplementary capital and half of the share capital also triggers the obligation to convene a shareholders' meeting (Article 233 of the Commercial Companies Code).
Based on your answers, there are no grounds for insolvency
Regularly revisit these questions, especially after losing a major client or contract. The protection of the board depends on whether they react in a timely manner.
Exception 3: Taxes and ZUS Contributions of the Company
For tax arrears of an LLC, simple joint-stock company, and joint-stock company, board members are jointly liable with all their assets if enforcement from the company's assets has proven ineffective (Article 116 § 1 of the Tax Ordinance). This liability is not determined by the court, but by the tax office in a decision. The same mechanism applies to unpaid contributions by ZUS (Article 31 of the Social Insurance System Act).
The most important rules:
- Liability covers arrears whose payment deadline expired during the board member's term (Article 116 § 2), even after leaving the board (Article 116 § 4).
- Defenses are similar to those in Article 299 of the Commercial Companies Code: timely bankruptcy or restructuring application, lack of fault, and additionally indicating company assets from which enforcement can significantly satisfy the arrears (Article 116 § 1(1) and (2)).
- A decision on liability can be issued within 5 years from the end of the year in which the tax payment deadline expired (Article 118 § 1).
In a small company facing difficulties, the first unpaid debts are usually VAT and ZUS contributions. Therefore, personal liability of the board may arise faster than with suppliers, as the authority does not need to go to court.
Exception 4: Personal Guarantees, Promissory Notes, and Mortgages
Banks, leasing companies, and large suppliers know that the assets of a small company can be modest. Therefore, they often require personal security from a shareholder or CEO. By signing them, you waive the protection provided by the company in this regard.
| Security | How it works | What to watch out for |
|---|---|---|
| Guarantee | You commit to pay if the company does not pay. It must be in writing; otherwise, it is invalid (Article 876 § 2 of the Civil Code). | A guarantee for a future debt is valid only up to a predetermined amount (Article 878 § 1 of the Civil Code). Check the limit and duration. |
| Promissory note guarantee (aval) | You are liable just like the one you guaranteed (Article 32 of the Promissory Note Law). | With a blank promissory note, the promissory note declaration matters. The objection of filling out the promissory note contrary to the agreement can only be raised to a limited extent (Article 10 of the Promissory Note Law). |
| Mortgage on private property | The creditor can enforce against the encumbered property. | The mortgage encumbers the property regardless of who owns it in the future. |
| Joining a debt, guarantee, declaration of submission to enforcement | You become a debtor alongside the company or enable enforcement without a process. | Read whether you are signing the document on behalf of the company or as a private individual. |
Exception 5: Conversion of JDG and Personal Actions
Conversion. If you convert a JDG into an LLC, for 3 years from the date of conversion, you are jointly liable with the company for debts from the business that arose before that date (Article 584¹³ of the Commercial Companies Code). The company does not "zero out" old debts. Additionally, the converted company is jointly liable for the tax arrears of the entrepreneur prior to the conversion (Article 112b of the Tax Ordinance).
Own tort. The company does not protect against liability for damage caused personally, for example, by misleading a contractor. The Supreme Court has accepted that a claim under Article 299 of the Commercial Companies Code may coincide with liability under Article 415 of the Civil Code (Supreme Court judgment of April 25, 2012, II CSK 410/11).
Liability to the company. A board member is liable to the company for damage caused by actions contrary to law or the company's agreement (Article 293 § 1 of the Commercial Companies Code). Since October 13, 2022, the business judgment rule applies: a board member does not violate the duty of care if they act loyally towards the company within the limits of reasonable business risk, also based on information and analyses that should be taken into account (Article 293 § 3 of the Commercial Companies Code).
Private Assets in JDG: Home, Savings, and Spouse
In a sole proprietorship, there is no separate company property. A creditor with a judgment can seize everything that belongs to the entrepreneur, except for items excluded from enforcement (including basic household items, tools for personal work, and for the entrepreneur, money for maintenance for 2 weeks – Articles 829–833 of the Civil Procedure Code).
| Asset Component | Can a creditor from JDG reach it? |
|---|---|
| Bank accounts and savings of the entrepreneur | Yes, subject to statutory amounts exempt from seizure. |
| Apartment or house in the personal property of the entrepreneur | Yes. |
| Joint property of spouses | Yes, if the spouse agreed to incur the obligation (Article 41 § 1 of the Family and Guardianship Code, Article 787 of the Civil Procedure Code). Without this consent, the creditor will reach the debtor's personal property, their salary and income, and items included in the enterprise (Article 41 § 2 of the Family and Guardianship Code, Article 787¹ of the Civil Procedure Code). |
| Personal property of the spouse | Generally no. |
| Property under a prenuptial agreement (separation) | Separation of property works against the creditor only if they knew about it when incurring the debt (Article 47¹ of the Family and Guardianship Code). It protects against future debts, not those that already exist. |
Comparison of Business Forms
The table shows differences in liability, taxes, and obligations. The amounts of service costs are approximate market estimates, not official rates.
| Form | Owner's Liability | Income Tax | Accounting and Formalities | Typically for |
|---|---|---|---|---|
| JDG | All assets, without limits | PIT: scale, linear 19% or lump sum | Simplest (CEIDG, KPiR or revenue records) | Low-risk services, starting a business |
| Civil Partnership | Partners jointly, without order (Article 864 of the Civil Code) | PIT of the partners | Like JDG, plus partnership agreement | Collaboration of 2–3 people without registration in KRS |
| General Partnership | Partners with all their assets, but only after ineffective enforcement from the company (Articles 22 § 2, 31 of the Commercial Companies Code) | PIT of the partners | KRS, usually full accounting | Family businesses, partners on equal rights |
| Limited Partnership | General partner without limits, limited partner up to the amount of the limited partnership contribution (Articles 102, 111, 112 of the Commercial Companies Code) | CIT of the company and tax on distributions | KRS, full accounting | Investor plus managing person |
| LLC | Shareholders are not liable (Article 151 § 4 of the Commercial Companies Code); board – Article 299 of the Commercial Companies Code, Article 116 of the Tax Ordinance | CIT 9% or 19% plus 19% on dividends; or Estonian CIT | KRS, full accounting, reports, minimum capital of 5,000 PLN | Higher-risk activities, shareholders, plans for sale or succession |
| Simple Joint-Stock Company | Shareholders are not liable (Article 300¹ § 4 of the Commercial Companies Code); board – Article 300¹³² of the Commercial Companies Code | Like LLC | KRS, full accounting, register of shareholders, capital from 1 PLN | Startups, shareholders contributing work or know-how |
Company and Taxes and ZUS in 2026
Asset protection is just one argument. Before deciding on a company, calculate the costs. The most important numbers for 2026:
- The sole shareholder of an LLC pays ZUS like an entrepreneur (Article 8(6)(4) of the Social Insurance System Act) – full social contributions, without start-up relief, preferential ZUS, or Small ZUS Plus. In 2026, this is 1,926.76 PLN monthly with sickness insurance. Additionally, a health contribution of a fixed amount of 830.58 PLN monthly, without the right to deduction.
- CIT 9% is available to small taxpayers with revenues up to the equivalent of 2 million euros. However, it is not available in the year of starting the business and in the following year for a company formed from the conversion of JDG (Article 19(1a) of CIT) – then the rate is 19%.
- Dividends are taxed at 19% PIT. The total burden on profit paid to the shareholder is therefore about 26.3% with CIT 9% and about 34.4% with CIT 19%.
- Estonian CIT (lump sum on company income) when distributing all profits gives, according to the Ministry of Finance, a total burden of about 20% (small taxpayer) or 25%, but requires, among other things, employment and that shareholders are only natural persons.
- Full accounting in an accounting office usually costs from about 1,000 to 3,000 PLN monthly (market estimate, depending on the number of documents).
An approximate comparison of how much remains for the owner annually when all profit goes to them. Assumptions: profit before taxes and owner contributions, JDG on linear tax, LLC with one shareholder paying ZUS and health contributions, without accounting costs and without reliefs. This is a simplified model for comparison, not a calculation for a specific company.
| Annual Profit | JDG, linear 19% | LLC, CIT 9% + dividend | LLC, CIT 19% + dividend |
|---|---|---|---|
| 150,000 PLN | approx. 97,700 PLN | approx. 77,500 PLN | approx. 65,300 PLN |
| 300,000 PLN | approx. 213,300 PLN | approx. 188,000 PLN | approx. 163,700 PLN |
| 600,000 PLN | approx. 441,700 PLN | approx. 409,200 PLN | approx. 360,600 PLN |
The conclusion from this model: with one shareholder who distributes all profits, an LLC rarely wins tax-wise against a JDG on a linear tax. The company starts to make sense when profits are retained in the business and reinvested, when liability risk is high, when there are more shareholders, or when clients require cooperation with a company.
How to Transition from JDG to LLC
There are two main paths. The choice depends on whether the company has contracts, permits, and assets that are difficult to transfer.
| Conversion of JDG | New Company (e.g., through the S24 portal) and gradual closure of JDG | |
|---|---|---|
| What happens to contracts, permits, reliefs | The company takes over all rights and obligations of the entrepreneur, including permits, concessions, and reliefs, unless the law or decision states otherwise (Article 584² of the Commercial Companies Code) | They must be transferred or obtained anew |
| Formalities | Conversion plan in the form of a notarial deed, financial statement, asset valuation, plan examination by an auditor, declaration of conversion, company agreement, entry in KRS (Articles 584⁵–584⁹ of the Commercial Companies Code) | Agreement on a template, minimum capital of 5,000 PLN paid within 7 days of entry, application to KRS |
| Administrative fees | Application for the appointment of an expert 300 PLN, entry in KRS 500 PLN, plus expert's fee and notarial fee | Entry in KRS via S24: 250 PLN |
| Estimated cost and time | Several to several tens of thousands of PLN, usually 3–6 months (estimate) | From a few thousand PLN, registration even in a few days (estimate) |
| Old debts | You are jointly liable with the company for 3 years (Article 584¹³ of the Commercial Companies Code) | Remain with you as an entrepreneur |
The date of conversion is the day the company is entered in the KRS (Article 584¹ of the Commercial Companies Code). As of November 29, 2025, entries in the KRS are no longer published in the Court and Economic Monitor, so there is no separate fee for this announcement. After registration, remember to report the beneficial owner to CRBR within 14 days, to provide an address for e-Delivery, and to fulfill obligations in KSeF.
An LLC can be established and run by a person living outside Poland. However, without a PESEL number, you will not be able to use the trusted profile, so a qualified electronic signature will be needed for signing in S24. Also, remember that the annual financial statement to KRS can only be submitted by a person whose PESEL is disclosed in the register, or by a lawyer or legal advisor. Managing a company from abroad may also affect its tax residency – this is a topic to discuss with a tax advisor.
Legal Asset Protection vs. Hiding Assets
The boundary is simple: you can legally manage risk for the future. You cannot escape from debts that already exist or threaten.
| Legal Risk Management | Actions that the law undermines or punishes |
|---|---|
| Choosing a legal form appropriate to the risk before debts arise | Donating a house to a spouse or children when the company is already not paying – the creditor can challenge it with a Paulian action (Articles 527–534 of the Civil Code); it is presumed that close persons knew about harming creditors |
| Business liability insurance and, for the board, D&O insurance | Transferring assets free of charge in the year before the bankruptcy application – it is ineffective against the bankruptcy estate (Article 127 of the Bankruptcy Law) |
| Property separation established before incurring debts and known to contractors | Hiding, disposing of, or destroying assets in the face of insolvency or to thwart enforcement – a crime (Article 300 of the Penal Code) |
| Reasonable liability limits in contracts (except for intentional damage – Article 473 § 2 of the Civil Code) | Transferring assets to a newly created company to avoid enforcement (Article 301 of the Penal Code) or paying only selected creditors in the face of insolvency (Article 302 of the Penal Code) |
| Timely bankruptcy or restructuring application | Delaying the application to "wait it out" – personal liability under Article 299 of the Commercial Companies Code, Article 21 of the Bankruptcy Law, and Article 586 of the Commercial Companies Code |
A family foundation is also not a way to avoid debts: the foundation is jointly liable with the founder for their obligations incurred before the property is contributed, up to the value of that property (Family Foundation Act, Articles 8–9).
Checklist: What to Ask Your Accountant and Lawyer
Print this list (in your browser: Print or Save as PDF) and take it to your meeting.
- What is the real level of liability risk in my industry, and do I have appropriate business liability insurance?
- What marital property regime do I have, and did my spouse consent to the company's obligations?
- What guarantees, promissory notes, and mortgages have I personally signed? For what amount and for how long?
- Given my income and distributions, is an LLC cheaper or more expensive than JDG? How much will I pay ZUS as the sole shareholder?
- Conversion or new company – which contracts, permits, and reliefs must I retain?
- What debts from JDG will burden me for 3 years after conversion?
- Who will be on the board, and what obligations are associated with this role?
- How will I monitor the company's liquidity and arrears to the tax office and ZUS each month?
- What action plan will I adopt if the company starts delaying payments? Who will make the decision about filing for bankruptcy or restructuring?
- Does D&O insurance make sense in my situation, and what exactly does it cover?
- How to document board decisions to demonstrate due diligence in case of a dispute?
Common Myths
| Myth | Fact |
|---|---|
| “In an LLC, my house is always safe.” | As a shareholder, generally yes. As a board member – no, if the company becomes insolvent and you do not react in time. Personal guarantees also open the way to your assets. |
| “It’s enough to resign from the board.” | You are liable for debts incurred during your term, even after leaving the board. |
| “I’ll transfer the house to my wife, and there will be peace.” | A donation to a close person can be challenged by a creditor within 5 years, and hiding assets can be a crime. |
| “Converting to a company cuts off old debts.” | For 3 years, you are jointly liable with the company for them. |
| “A company always means lower taxes.” | With one shareholder who distributes all profits, it is often the opposite. |
Frequently Asked Questions
Can a bailiff seize the house of the CEO of an LLC?
No, for the company's debt alone. The creditor must first demonstrate the ineffectiveness of enforcement against the company and then obtain a separate judgment against the CEO based on Article 299 of the Commercial Companies Code, or the tax office or ZUS must issue a decision based on Article 116 of the Tax Ordinance. Only such a title allows for enforcement against the CEO's assets, including their house.
Does a shareholder of an LLC bear responsibility for its debts?
Generally, no (Article 151 § 4 of the Commercial Companies Code). A shareholder is personally liable only if they committed to it (guarantee, promissory note, mortgage), for 3 years after converting JDG for its old debts, or if they personally caused damage.
How long does the board have to file for bankruptcy?
30 days from the day the grounds for declaring bankruptcy arose (Article 21(1) of the Bankruptcy Law). A delay in payments longer than 3 months creates a presumption of insolvency, but insolvency may occur earlier.
Does restructuring protect a board member the same way as a bankruptcy application?
Yes, if a decision to open restructuring proceedings or approve a settlement was made in a timely manner (Article 299 § 2 of the Commercial Companies Code, Article 116 § 1(1)(a) of the Tax Ordinance). The date of the decision matters, not just the start of negotiations with creditors.
Does a prenuptial agreement protect against the debts of a husband or wife?
Only for the future and only against creditors who knew about it at the time of incurring the debt (Article 47¹ of the Family and Guardianship Code). A prenuptial agreement made when debts already exist does not protect against them.
As the sole shareholder, do I have to pay ZUS?
Yes. The sole shareholder of an LLC is subject to insurance like a person conducting business (Article 8(6)(4) of the Social Insurance System Act) and does not benefit from reliefs for new entrepreneurs. The situation is different in a company with more than one shareholder – in 2024, the Supreme Court accepted in a resolution III UZP 8/23 that a shareholder of a two-person company is not subject to insurance for this reason, even if they hold 99% of the shares. Consult with an advisor before such a solution, as ZUS may investigate whether the second shareholder is not fictitious.
Related Guides
- Starting a Business in Poland After Returning from Emigration: CEIDG, ZUS Reliefs, and Tax Choices
- ZUS 2026 for Entrepreneurs: Full Contribution Table
- Polish e-Authorities from Abroad: Trusted Profile, e-Delivery, eZUS
- How to Verify a Company in Official Registers (KRS, CEIDG)
- Tax Residency and PIT for the Polish Diaspora
Sources
Legal status: October 23, 2026. This guide is educational and does not constitute legal or tax advice in individual cases. Interactive diagrams simplify regulations and do not preclude your liability. Before deciding on a legal form, conversion, or in situations of insolvency risk, consult a legal advisor, attorney, tax advisor, or restructuring advisor.
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