New contribution system for the self-employed in Spain

In this blog of Mercury Abogados in Marbella we are going to see the new contribution system for self-employed workers in Spain with the entry into force of Royal Decree-Law 13/2022, of July 26th, 2022.

This change in the contribution system comes into force on January 1st, 2023. With this change, all self-employed workers will have to pay Social Security (hereinafter SS) contributions based on their net annual income.

For this purpose, this income refers to all income obtained in the calendar year, excluding income obtained as an employee or similar. And the rules for calculating the net income shall be carried out in accordance with the provisions of the Personal Income Tax (Impuesto de la Renta de Personas Físicas in Spanish) regulations.

Of the amount obtained, 7% will be deducted for general expenses, except in the case of administrators or partners of companies with 25% or 33%, respectively, or more of the shares, in which case the percentage to be applied will be 3%.

What price should we apply?

To find out the contribution base to be applied, we must start from the monthly average of the annual net income. This base will be provisional, and at the end of the year, if the base is lower than the income obtained, the SS will issue a summons to pay the difference. On the other hand, if it is higher than the corresponding amount, the SS will pay the difference before 30 April of the following year.

A general table and a reduced table of contribution bases with maximum and minimum monthly contribution bases will be established annually.

If a change in net income is expected during the year, the contribution base can be changed every two months, up to a maximum of six times a year.

As you can see, this regulation represents a significant change in the New contribution system for the self-employed in Spain. We recommend that you contact our expert employment lawyers at Mercury Abogados in Marbella for more information.

Also, do not hesitate to contact our Law Firm in Marbella if you have any questions about the new contribution system or even to advise you on any other matters. Our expert lawyers would be delighted to assist you.