How To Become a Self-employed Autonomo in Spain?
When you decide to start a self-employed activity, the first question to solve is: “How to become a self-employed (autonomo) in Spain?”.
The first thing you should do is apply for registration or enrollment in the Entrepreneurs, Professionals and Withholders Census. You have to submit form 036 or form 037.
Which form should I use?
You can use form 037 if:
– You don’t act through a representative and live in Spain.
– Your tax residence is the same as the administrative management one.
– The VAT system to comply with is standard, simplified, agriculture, livestock, fishing, or equivalent surcharge.
– You haven’t registered in the monthly refund register.
– You don’t make remote intra-community acquisitions of goods or sales.
– Your taxes are not Special Taxes nor by Insurance Premium Tax.
– Your income is not from movable capital (i.e., shares incomes).
If you don’t meet any of these criteria, you have to use form 036 to register.
You can download both forms from the Tax Agency’s website, which also includes standard instructions for both forms:
– Form 036
– Form 037
Once you complete the form you are interested in, you must submit it at the Tax Agency’s office from your tax residence, along with the proof that you are the signatory or that you authorise a representative to deliver the form.
What obligations do I have to comply with?
Once you register in Treasury, you must submit the required quarterly tax forms depending on your registration activity and configuration. Many new independent workers make the mistake of not submitting anything at first because they haven’t had any income or expenses for a few months.
Don’t forget that you must submit your tax forms if you have registered in the Tax Agency, even if you had “no activity” or zero income. Not submitting anything means that you will have to face the corresponding penalties.
How much will I have to pay?
Apart from the expenses that come from developing your activity, it would be best to consider that you should pay taxes at the end of each quarter. Therefore, if you register:
– VAT (form 303)
You will have to pay the VAT that comes out of the equation:
(VAT from your income invoices) – (VAT from your expense invoices)
If this equation comes out negative, it means that you get VAT “to compensate”, i.e., you will compensate the amount with the following quarters. So you won’t have to pay anything for this.
– IRPF (form 130)
You will have to pay 20% of your profits. Many new self-employed recall VAT but don’t remember IRPF (in case they are in obligation). By the end of the quarter, they realise that this business is not profitable if they have to pay for this form.
Keep in mind that form 130 is a payment on account, and when you do the annual income, there will be amounts already credited in your annual tax payment. If you have gained more than what you have to tax, Hacienda will refund you. Otherwise, you will have to pay, but deducting what you’ve paid already.
– Form 111
When you have business relationships with other professionals subject to withholding, keep in mind that the obligation to withhold them is yours. That means that you will pay the amount of withholdings practised during the period quarterly.
– Form 115
Suppose you are also developing your business in rented premises, which invoice includes withholding per rental. In that case, you will also have the quarterly obligation to submit these withholdings.
In addition to being aware of your obligations, you must be aware of your clients and how your business is going. It’s a fact that today there is much information on how to fill out your tax forms. Still, we recommend you trust a tax advisor with the submission of your tax obligations.
In Self-employed Spain, we find more and more cases of self-employed workers who have tried to do it all by themselves to save money. Eventually, they have saved one, two or three months of tax advice but have been sanctioned for not submitting certain forms on time.
Inform yourself, do your calculations and trust your accounting and taxes to a professional advisor!
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