The Council of Ministers will today approve the new contribution system for self-employed workers who will contribute on the basis of actual income and not on a voluntarily chosen basis as is the case now.
The new model, which will have to be implemented in Spain to 3.4 million self-employed workers, will have a transition period of nine years until it is finalized in 2032, with 15 net income brackets and a contribution base ranging from a minimum fee of 230 to 500. Have taken Euro (see attached table).
Its objective is to equalize the benefits between the General Governance and RETA. The average pension in the self-employed is 43% lower than normal, a difference of around 600 euros. However, this reform does not only address the contribution table, as the regulation it approves today considers other points of interest for the self-employed.
Supervisory role of tax agency. One of the main innovations of the new system is that it gives the tax agency an important supervisory role when it comes to determining the actual income which is crucial while making the assessment. The regularization corresponding to each financial year will be carried out in the next year and based on the data communicated by both the tax agency and the provincial administration. The role of the Treasury will also be decisive when it comes to knowing and applying the various deductions self-employed employees are entitled to when determining their net income, to which contributions in the tables will be applied.
General deduction for self-employed. Treasury information will also be important when it comes to crossing data with Social Security in terms of deductions. In addition to those included in the relevant rules, the model considers two new ones agreed last week. The new rule, effective January 1, 2023, establishes a deduction for ordinary expenses of 7% for individual self-employed workers, while this same deduction is reduced to 3% in the case of self-employed workers.corporate.
Change up to six volumes. The number of times the self-employed can revise their contribution base is increased. From now on they will be allowed up to six instead of four. The objective is to adjust the price for its performance forecast for the year, as it can vary depending on the activity performed, which gives the new system greater flexibility. As stated in the bill, provided the general treasury of Social Security has been requested, they may make this change from the first day of March, May, July, September, November and January of the following year. In addition to the application, workers must declare a monthly average of the annual net economic return.
The contribution limit disappears for people over the age of 47. By 2023, the contribution limit disappears for workers over the age of 47. This limit no longer makes sense, as the stipulation with the new system would be that the income guarantees it is in the correct contribution bracket. Previously, these higher contributions were used voluntarily to increase the amount of retirement pensions in the years before retirement benefits were reached.
Low fee: 80 euros. As a self-employed worker, there will be assistance in the form of low fees in the beginning of the activity. With an initial period of 12 months, the new rule considers a fee of 80 euros per month. This period can be extended for one more year if the self-employed person records an income less than the SMI during the first year of activity as a self-employed employee.
Deduction of 10% of pension scheme. Another innovation envisaged for the self-employed is the deduction of 10% of the contribution to the pension scheme in personal income tax (IRPF).
Priority reinforcement of electronic processing. Mobile phone is going to be the main management tool for the self-employed. Registering, canceling, selecting section and quota, as well as accessing the self-employed person’s data and file and even the quota to be paid based on income before proceeding as accurately as possible It would be possible to do simulations to know. to discharge.
Partial cessation of activity. Profits of 50% of the regulatory base consistent with any other activity are recognized and can be accumulated over four months to two years, without the need to revoke and close the RETA. To access it, you must have a 75% reduction in the level of income or sales when there are no employees, or the same situation for two quarters, the income does not exceed the SMI and there is a reduction in working hours or contracts. Suspension of 60% of employees, if there is an employee in charge.