Sole Practice or Medical Entity - Which to Choose?

Before you register with RPWDL and start working, you need to make a key decision: which legal form should you choose for your practice?

This isn't a cosmetic choice -- it affects how much tax you'll pay, whether you can employ other physiotherapists, what your administrative duties will be, and whether you'll have access to NFZ patients.

In this article we'll break down the three main forms and show you which one fits you best.

Form 1: Sole professional practice (IPZ)

What is it?

A sole professional practice is the simplest way to run a clinic. You're the sole trader, you work for yourself, and you decide your own working conditions.

Legal basis: the Act of 15 April 2011 on Medical Activity and the Ministry of Health regulation of 11 April 2018 on registering professional practices.

Who can run one?

• A physiotherapist with a PWZFz (Physiotherapist Licence) -- this is a requirement
• An EU or EEA citizen -- can also run a practice in Poland, but their qualifications must be recognised

Who can work at an IPZ?

This is a limitation: at an IPZ you can only employ administrative staff. You can't employ another physiotherapist.

If you need help from a second physiotherapist, you'll need to move to a group professional practice (see below).

Premises and equipment requirements

Requirements are moderately strict:

• Premises: min. 10-12 sqm for the treatment room (varies by region), separate from residential space
• Equipment: a treatment couch, basic equipment (that's the minimum)
• Access to water and a toilet (available to patients)
• Documentation: organisational rules (if you work alone, not always mandatory, but recommended)

An IPZ doesn't require standards as strict as a medical entity -- that's an advantage.

Taxes at an IPZ

This is where an IPZ offers the biggest savings. You have several options:

Option 1: Flat-rate tax on revenue (14%)

• You pay 14% of gross revenue
• The simplest and most commonly chosen option
• Example: earn 10,000 PLN → tax of 1,400 PLN

Option 2: Progressive scale (12% to 32%)

• Depends on net income
• Above 85,528 PLN: 32% plus a solidarity levy
• More expensive than the flat rate for small practices

Option 3: Flat 19% tax

• A fixed tax rate regardless of revenue
• Rarely chosen, as it's higher than the flat-rate option

Social insurance (ZUS) at an IPZ:

• Standard: 1,600-1,700 PLN/month
• Preferential (first 24 months): 400-500 PLN/month
• Half of the contribution is tax-deductible

VAT:

• Exemption for medical services -- a big advantage. You don't need to charge VAT to patients

Sample IPZ budget

Earnings: 10,000 PLN/month (40 patients × 250 PLN)

Revenue	10,000 PLN
- Tax (14% flat rate)	1,400 PLN
- Social insurance (preferential)	500 PLN
- Rent, utilities, insurance	4,000 PLN
= Net take-home	~4,100 PLN

This is a gross calculation, but it shows that an IPZ is viable even at starting earnings levels.

Pros of an IPZ

• Least bureaucracy
• VAT exemption on medical services
• Flat-rate tax (simple)
• Quick registration (~14 days with RPWDL)
• Full autonomy over pricing and procedures

Cons of an IPZ

• You can't employ a physiotherapist (only an administrative assistant)
• A cap on administrative staff spending (max 30% of revenue under some tax schemes)
• You're solely liable for any mistakes (no liability shield)
• Harder to grow the business without a partner

[SP] Example -- Sole practice: You open an IPZ in Warsaw. You rent 15 sqm of premises, buy basic equipment, and hire a receptionist part-time (8 hours/week). A year in, you're working at 80% capacity, earning ~8,000 PLN/month net. The IPZ turns out to be ideal -- no extra bureaucracy, transparent taxes.

Form 2: Group professional practice (GPZ)

What is it?

A group professional practice is run by at least 2 physiotherapists with a PWZFz who want to work together, sharing costs and liability.

Legal basis: the Act of 15 April 2011 on Medical Activity and the Ministry of Health regulation on GPZs.

Which legal forms are available?

A GPZ can take several forms:

General partnership (most common for physios):

• Each partner is jointly liable for the partnership's debts
• Profits are split equally (or as agreed)
• Simple registration, costs similar to an IPZ

Professional partnership (for groups of specialists):

• More formal than a general partnership
• Each partner is liable for their own actions, not the others'
• Higher prestige, but more expensive

Civil law partnership (informal):

• An agreement between partners
• Each settles their own tax individually
• Rarely used, as it's harder to manage

Staffing requirements

At a GPZ you can:

• Work as a salaried employee (if you're one of the partners)
• Employ additional physiotherapists (beyond the partners)
• Employ administrative assistants

That's a big advantage over an IPZ.

Premises requirements

Similar to an IPZ, but with the option to have multiple treatment rooms within one GPZ:

• Each treatment room needs a minimum of 10-12 sqm
• Shared spaces can be shared (waiting room, office)

Taxes at a GPZ

At a GPZ each partner settles their own income individually:

Example: a 3-person practice earns 30,000 PLN/month together

Partner A	10,000 PLN	14% flat rate → 1,400 PLN tax
Partner B	10,000 PLN	14% flat rate → 1,400 PLN tax
Partner C	10,000 PLN	14% flat rate → 1,400 PLN tax
Total	30,000 PLN	4,200 PLN tax

Operating costs are split three ways, so everyone pays less.

Pros of a GPZ

• Shared costs (rent, utilities, insurance)
• Can employ physiotherapists
• More scheduling flexibility
• Better reputation (a group of specialists)
• Access to NFZ patients (easier to qualify)

Cons of a GPZ

• Dependent on your partners (if one leaves, you have to divide things up)
• Joint liability (in a general partnership)
• More formalities (partnership agreement, business register)
• Complex settlements (if partners earn different amounts)

[GR] Example -- Group practice: You, Agata and Piotr decide to open a joint practice in Gdańsk. You rent 40 sqm of premises (3 small treatment rooms + a waiting room). Each of you works 4 days a week (one day off). Profits are split 50-50 (Agata and Piotr) plus 0% for you (as you're the administrator). A year in, the practice earns 25,000 PLN/month, and you take a 5,000 PLN salary plus a share of the profits. This model is more stable than going solo.

Form 3: Medical entity

What is it?

A medical entity is a fully registered medical institution able to provide healthcare services across a broader scope.

Legal basis: the Healthcare Activity Act (Art. 1-19) and Ministry of Health regulations on requirements for medical entities.

Which legal forms are available?

A medical entity can be:

• A limited liability company (Sp. z o.o.)
• A joint-stock company (S.A.)
• An association
• A medical cooperative
• A sole trader business (for doctors)

The most popular: a limited liability company (Sp. z o.o.) -- gives liability protection and tax flexibility.

Staffing requirements

At a medical entity you can:

• Employ an unlimited number of physiotherapists
• Employ doctors, nurses, diagnosticians
• Work as a manager or owner

That's the main advantage over professional practices.

Premises and equipment requirements

Requirements are much stricter than for professional practices:

• The premises must have a separate entrance (not within a flat)
• Each treatment room: min. 12-15 sqm (more than in a practice)
• Mandatory building documentation (certificates, permits)
• An infection-control system
• Risk-management procedures
• Quality and patient safety documentation

This costs a minimum of 50,000-100,000 PLN to set up.

Taxes at a medical entity (Sp. z o.o.)

If you set up a limited liability company, you can choose:

Corporate income tax (CIT, 19%) on the company's profits:

• Profit = Revenue - Operating costs
• Example: revenue 100,000 PLN - costs 60,000 PLN = profit 40,000 PLN → CIT of 7,600 PLN

Personal income tax on your own salary (as an employee/director):

• Usually a 14% flat rate or the progressive scale
• You're on payroll, so you also pay tax like an employee

VAT: No exemption (unlike professional practices):

• You must charge VAT to patients (23%)
• You can deduct VAT on expenses
• More bureaucracy, but also benefits (deductions)

Pros of a medical entity

• Full flexibility in hiring
• Easy to scale (new branch, new services)
• Access to NFZ contracts
• Liability protection (Sp. z o.o.)
• Can acquire other practices
• Prestige (patients see a "clinic", not a "practice")

Cons of a medical entity

• Expensive registration (50,000-100,000 PLN)
• Highly demanding documentation (monthly reports)
• CIT plus VAT (more complex settlements)
• Withholding tax (on employee salaries)
• Annual inspections (KIF, NIK, Sanepid)
• No VAT exemption (prices rise)

[GR] Example -- Group practice (as an Sp. z o.o.): A group of 4 physios decides to set up "FizjoClinic Warszawa" Sp. z o.o. Each contributes 10,000 PLN (40,000 PLN total capital). They rent large premises (100 sqm), and employ 6 salaried physiotherapists (beyond the four partners). A year in, the company earns 200,000 PLN, with 120,000 PLN in costs. CIT: 19% of profit (~15,000 PLN). Each partner draws a salary from this (~60,000 PLN/year plus profits). This is far more formalised, but also far more scalable.

Comparison table -- what should you choose?

Feature	IPZ	GPZ	Medical entity
Number of people	1	2+	1+ (a company)
Can employ	Admin only	Physios + admin	No limits
Registration requirements	Low (approx. 175 PLN)	Medium (2,000-5,000 PLN)	Very high (50,000+ PLN)
Taxes	14% flat rate + social insurance	14% flat rate (individually)	19% CIT + 23% VAT
VAT	Exempt	Exempt	No exemption
Bureaucracy	Minimal	Medium	High
Business growth	Difficult	Medium	Easy
NFZ access	Yes	Yes (easier)	Yes (easiest)
Start-up time	2-4 weeks	4-8 weeks	3-6 months

When should you change legal form?

From IPZ to GPZ

Change if:

• You want to employ another physiotherapist
• Revenue has grown and the flat-rate tax is starting to cost more than it saves
• You have a partner who wants to join the practice

Procedure: registering a new GPZ with RPWDL (~2 weeks) plus winding down the IPZ (which may involve suspension).

From a practice to a medical entity

Change if:

• Revenue exceeds 400,000 PLN/year
• You want to employ 5+ people
• You're planning to open further locations
• You want to apply for an NFZ contract

Procedure: setting up a new medical entity, transferring patients, closing the old practice (~3-4 months).

Frequently asked questions

Q: Can I start with an IPZ and then move to a GPZ?

A: Yes, that's a natural path. Many practices start with one person (IPZ), and after a year a partner joins, and they move to a GPZ. Registering the new practice takes ~2 weeks.

Q: In a GPZ, does every partner have to be a physiotherapist?

A: Yes. Both partners must hold a PWZFz and be registered with RPWDL. You can't have a business partner who isn't a physio.

Q: Can I work under an employment contract at someone else's practice?

A: Yes, this is a common arrangement. Pay is usually ~60-80% of the patient revenue you generate (the other 20-40% goes to the employer to cover costs). It's less independent, but also less risky.

Q: How long does changing legal form take?

A: Typically 2-4 weeks (moving from an IPZ to a GPZ) up to 3-6 months (moving from a practice to a medical entity). KIF must always be notified.

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