This is a question that each manager or partner will ask, ideally before the company is set up. It is immediately followed by another – what is the most optimistic way to withdraw profits from a company?
In order to assess the advantages of individual variants, let us first try to imagine them.
Basic situation – managing director without remuneration
Such status is given to any manager who does not perform any act (e.g. not employed, signs an agreement on the performance of the manager's duties, or does not pay another form of remuneration). If someone else does not pay for you health insurance, you have the status of a self-payer of health insurance and you are obliged to pay 79.31 Euros per month.
Managing director - employee, full employment
First of all, it is necessary to sign the employment contract and register with the social insurance company (before the date of the employment relationship), within 7 days also to the health insurance company and by the end of the month following the month in which the employment relationship started also for tax on employment. It is also necessary to submit monthly reports to the social and health insurance company and overviews to the tax office. If you choose an employment relationship, the minimum wage for 2022 is set at 646 Eur. Of course, it is also possible to pay out the entire monthly profit in the form of salary. However, it should be prepared that levies and taxes are in the amount of from 36% (for gross salary 365€) to 47% (5000€) of the total labour price. This form is chosen by the owners of the company most when they need a mortgage or plan to go on maternity leave.
Manager – contract for the performance of the function of managing director or part-time employment
As with full employment, it is necessary to register with insurance companies and submit monthly reports and surveys. However, there is no minimum remuneration for the performance of the function of managing director. It also does not prevent you from setting your working time at 1/8, i.e. 1 hour per day, which represents a gross salary of only EUR 80.75 per month in 2022. For this amount of remuneration, health and social security contributions are only 39.20 Eur (11.30 EUR ZP and 27.90 EUR SP) you do not pay tax on dependent activities if you apply a tax-free portion to the taxpayer.
Is someone else paying for you health insurance?
If you are a pensioner, student, employee in another company, or a health insurance sole trader paid for you by someone else, i.e. you no longer need to be a "self-payer" of health insurance. In this case, the best form of managing director for you is without remuneration and to pay the entire profit made in the form of dividends.
Dividends
After the financial statements have been drawn up and the tax has been paid, you will be left with a profit after tax. This amount can be paid out as a dividend. It is sufficient for the shareholder's decision or general meeting to approve the payment. 7% tax is paid on the dividends paid (currently this can be done by withholding – it pays directly to the company and sends the manager the amount humiliated by the tax, or the partner admits the dividends in the tax return filed for the year and pays the tax).
The payment of dividends is not compulsory, so it is often possible to see large amounts of retained earnings in the accounts of companies. Entrepreneurs hereby delay the payment of the tax on dividends until the future. This approach is not prohibited, but carries risks. It is still the property of the company and can be blocked by the bailiff, enforced on the courts, etc.
Which option is best for me?
If no one pays health insurance for you, it is best to sign an agreement on the performance of the position of managing director with low remuneration, or 1/8 of the time. You can save more than 40 Euros per month compared to a self-payer.
If someone else pays for you, the best option is an executive without remuneration.
In both cases, the remainder of the profits will then be paid in the form of dividends.
