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The Minimum Contribution Base Of The Self-employed In Spain

Social SecurityLaw and Tax Changes

Minimum Contribution Base

The minimum contribution base of the self-employed in Spain is one of the issues that have always generated controversy. In this article, we will give you the details of the minimum base, the amounts applied for this year, and the advantages and disadvantages it has.

What is a contribution base?

The self-employed worker doesn’t receive a salary as such, which is why he chooses the basis for which he wants to contribute. Of course, there is a legal minimum and maximum that all self-employed in Spain must meet.

When do I choose that contribution base?

When registering for Social Security as a self-employed worker (autonomo), you must indicate in the form what is the basis on which you are going to contribute. And this is where most freelancers choose the minimum contribution base.

What is the minimum contribution base?

By choosing the minimum base, you mean that it is possible that you will obtain high returns in the exercise of your activity, but you will always pay the same to Social Security. For this year, the minimum base established by Social Security is € 944.40 per month.

Workers over 65 years and 38 years and 6 months of contributions or 67 years and 37 years of contributions, from 01/01/2021, will be obliged to contribute only for Temporary Disability and Professional Contingencies.

Advantages of contributing by the minimum base

The law establishes that the self-employed have to contribute by the minimum base, that is, the minimum interprofessional salary. But the truth is that many self-employed don’t know the advantages and disadvantages of this system.

Logically, if you choose the minimum base, you pay a lower Social Security fee than if you choose the maximum. And that is why the number of those who choose the minimum base is more significant. Despite this, although it may seem the best option, in reality, it is not, since the administration will calculate the amounts of the disability benefit and the retirement pension based on the chosen base.

Disadvantages of contributing for the minimum base

That is a point that the self-employed must take into account during the contribution. The mandatory minimum contribution base is € 944.40 per month for this year.

That amount corresponds approximately to the Interprofessional Minimum Salary (SMI), which has been € 965 / month since September 2021.

Temporary disability

If you contribute for the minimum base and take sick leave, you will receive the 60% of the base during the first 20 days and later 75%. 

But be careful! You continue to pay the fee during the withdrawal period, so your IT benefit is meagre.

The retirement pension

The average monthly charge for self-employed pensioners is € 795.14, 40% lower than the average for the General Scheme, which is € 1,338.84 / month.

For that reason, when the self-employed see that retirement age is approaching, they try to increase their contribution base. But that doesn’t lead to great results since:

– To calculate the retirement pension, Social Security will take into account what you have contributed in the previous 25 years.

– The freedom of choice of the base is restricted from the age of 47, and it is only possible to raise it gradually according to the established limits.

The best option is choosing a contribution base that corresponds to the benefits you obtain in your activity; otherwise, you can find yourself in any of the previous cases.

Although given the uncertainty regarding the self-employment fee and retirement in the near future, our advice is that you learn more about how to invest your savings wisely by taking advantage of compound interest.

Calculate Your Self-employed Payments

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