Everything that changes for self-employed people in Spain this year
New social security contributions, a tax to top up pension funds, a reduction in retention rates for artists - 2023 will bring many developments for all self-employed workers in Spain.
New social security contributions for self-employed
From 2023, Spain’s autónomos will pay monthly social security fees based on how much they earn, instead of a fixed rate. Previously, freelancers have had to pay a minimum contribution base of €294 per month after they have been registered as self-employed for two years, regardless of how much they earn.
Instead of there being a fixed rate of €294, the fee will go down progressively to €200 a month for lower earners and progressively higher - up to €590 a month - for higher earners. This means that some self-employed workers will see their social security payments reduced, however, for anyone earning over €1,700 per month, they will increase.
New tax for all workers
From 2023, all workers, whether self-employed or salaried in Spain will have to pay an extra tax to help fill up the country's pension fund. Trade unions estimate that for autónomos, the average monthly payment will be around €5.
READ ALSO: Everything that changes about working in Spain in 2023
No social security tax for new autónomos in Madrid
Back in September 2022, the regional government in Madrid announced that from 2023, new autónomos in Madrid will have their social security fees paid for by the local government for their first year of self-employed work in the region.
If their monthly earnings are below minimum wage in the second year (€1,166 gross a month), they will also have their social security fees covered by the regional government. This means that new self-employed workers in Madrid will save hundreds or potentially several thousands of euros during their first year or two years of work.
READ ALSO: The tax changes in Spain in 2023 that you need to know about
Benefits for self-employed mothers
Women who are self-employed and have children under 3 years of age will receive a benefit of €100 per month until the child has their third birthday.
To be eligible, at the time of giving birth, they must either be receiving a benefit or subsidy for unemployment or be registered with Social Security. Women who register later and have already accumulated at least 30 days of contributions will also be eligible.
READ ALSO: How to hire someone if you’re self-employed in Spain
Reduction in retention rates for artists
The withholding rate or IRPF for artists with the lowest level of income will be reduced to 7 percent. Previously, it was only 7 percent for the first couple of years of being an autónomo and from then on it went up to 15 percent.
Changes for unpaid/late invoices
As a freelancer, it’s unfortunately likely that you’ve been in a situation where you’ve had unpaid or late invoices and you’ve still had to pay tax on them, without having actually received the money yet. You then only had a limited amount of time in which to modify or change your invoice to reflect the fact that it hadn't been paid.
This situation is set to get easier in 2023 as the period in which you can rectify your invoice has been extended from 3 to 6 months. The methods used to claim payments have also been made more flexible and the minimum amount of the tax base that can be modified has been lowered from €300 to €50.
The threshold for tax declarations changes
In 2023 self-employed taxpayers whose gross income does not exceed €15,000 per year will not be required to file their yearly 2022 tax return.
This means that in April when it's time to file the Declaración de Renta, those who have earned income from more than one source will not be obliged to declare if the sum of all their income does not exceed €15,000. Previously, the threshold was €14,000.
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New social security contributions for self-employed
From 2023, Spain’s autónomos will pay monthly social security fees based on how much they earn, instead of a fixed rate. Previously, freelancers have had to pay a minimum contribution base of €294 per month after they have been registered as self-employed for two years, regardless of how much they earn.
Instead of there being a fixed rate of €294, the fee will go down progressively to €200 a month for lower earners and progressively higher - up to €590 a month - for higher earners. This means that some self-employed workers will see their social security payments reduced, however, for anyone earning over €1,700 per month, they will increase.
New tax for all workers
From 2023, all workers, whether self-employed or salaried in Spain will have to pay an extra tax to help fill up the country's pension fund. Trade unions estimate that for autónomos, the average monthly payment will be around €5.
READ ALSO: Everything that changes about working in Spain in 2023
No social security tax for new autónomos in Madrid
Back in September 2022, the regional government in Madrid announced that from 2023, new autónomos in Madrid will have their social security fees paid for by the local government for their first year of self-employed work in the region.
If their monthly earnings are below minimum wage in the second year (€1,166 gross a month), they will also have their social security fees covered by the regional government. This means that new self-employed workers in Madrid will save hundreds or potentially several thousands of euros during their first year or two years of work.
READ ALSO: The tax changes in Spain in 2023 that you need to know about
Benefits for self-employed mothers
Women who are self-employed and have children under 3 years of age will receive a benefit of €100 per month until the child has their third birthday.
To be eligible, at the time of giving birth, they must either be receiving a benefit or subsidy for unemployment or be registered with Social Security. Women who register later and have already accumulated at least 30 days of contributions will also be eligible.
READ ALSO: How to hire someone if you’re self-employed in Spain
Reduction in retention rates for artists
The withholding rate or IRPF for artists with the lowest level of income will be reduced to 7 percent. Previously, it was only 7 percent for the first couple of years of being an autónomo and from then on it went up to 15 percent.
Changes for unpaid/late invoices
As a freelancer, it’s unfortunately likely that you’ve been in a situation where you’ve had unpaid or late invoices and you’ve still had to pay tax on them, without having actually received the money yet. You then only had a limited amount of time in which to modify or change your invoice to reflect the fact that it hadn't been paid.
This situation is set to get easier in 2023 as the period in which you can rectify your invoice has been extended from 3 to 6 months. The methods used to claim payments have also been made more flexible and the minimum amount of the tax base that can be modified has been lowered from €300 to €50.
The threshold for tax declarations changes
In 2023 self-employed taxpayers whose gross income does not exceed €15,000 per year will not be required to file their yearly 2022 tax return.
This means that in April when it's time to file the Declaración de Renta, those who have earned income from more than one source will not be obliged to declare if the sum of all their income does not exceed €15,000. Previously, the threshold was €14,000.
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