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Pluriactivity or Flat Rate In The Self-employed Payments?
Social SecuritySavings
“Should I register as self-employed using pluriactivity or Flat rate in the self-employed payments in Social Security?”
More and more people have business concerns and want to start a business project. And many of them are already working as employees, which is usually what has given them the experience and knowledge in the sector they want to take advantage of.
And here comes the question, if I am registered in the general regime, should I register as a self-employed worker?
The answer is yes. If you are self-employed, you must register with the Special Regime for Self-Employed Workers (RETA), as the general regime only covers you when you are employed.
Once you know that you have to register with RETA, let’s see which of the reductions that are currently in place can be most profitable for you.
To be able to access these two reductions that we are proposing, pluriactividad or flat rate, it is necessary that this is your first registration in RETA, and that in this registration, starts a pluriactivity situation. In other words, you have to be working at two different employment activities, i.e. employment contract and business or sole trader activity, which require you to be registered with more than one Social Security scheme at a time (RETA and General Scheme).
If you comply with these conditions you will be able to access any of the two reductions, but, which one interests you more? Below, we will explain the advantages of each reduction and its terms:
FLAT RATE
1. 12 MONTHS: pay €60,00.
2. MONTHS 13 to 18: a 50% reduction on the minimum fee will be applied (€141,65).
3. MONTHS 19 to 24: a 30% reduction on the minimum fee will be applied (€198,31).
PLURIACTIVIDAD (with full-time contract)
1. The first 18-month period of registration, the minimum base will be reduced by 50%, leaving a fee of €141,65.
2. The second 18-month period of registration, the minimum base will be reduced by 25%, leaving a fee of €212,49.
(*) Amounts of contributions calculated on a minimum contribution base of €944,40 (base updated to January 2020), and choosing the standard contingency coverage (the self-employed person is entitled to the benefit for leave of absence due to either a common illness or a non-occupational accident).
In the following comparative table, you can see the savings in fees for each of the options:
| FLAT RATE | ||||
MONTHS | Profit | Fee | Total | % Saving |
12 | Flat rate fee | €60,00 | €720,00 | 57,64 % |
6 | 50% disc. over the minimum fee | €141,65 | €849,90 | 0,00 % |
6 | 30% disc. over the minimum fee | €198,31 | €1.189,86 | 6,67 % |
12 | Generic minimum fee | €286,15 | €3.433,80 | -25,74 % |
| Total payment adding the 36 months: | €6.193,56 |
| PLURIACTIVIDAD | ||||
MONTHS | Profit | Fee | Total | % Saving |
12 | 50% disc. over the minimum fee | €141,65 | €1.699,80 | -57,64 % |
6 | 50% disc. over the minimum fee | €141,65 | €849,90 | 0,00 % |
6 | 25% disc. over the minimum fee | €212,49 | €1.274,94 | -6,67 % |
12 | 25% disc. over the minimum fee | €212,49 | €2.549,88 | 25,74 % |
| Total payment adding the 36 months | €6.374,52 |
With this comparative table, and looking at the percentage of savings column, you will be able to determine which reduction you are most interested in according to your RETA registration month forecast.
Related articles:
Calculate Your Self-employed Payments In Spain
Tags: autonomo registration Spain, flat rate self-employed payments, pluriactividad for self-employed, pluriactivity self-employed Spain, self-employed register in Spain, Social Security payments, Social Security reductions