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SELF-EMPLOYED

Do I have to register as self-employed in Spain if I only work a few hours?

What if you want to earn a bit of extra money on the side as a freelancer in Spain in order to make ends meet - Is this legal and do you have to officially register as self-employed even if it's only an odd job or for a few hours a month?

Published: 27 October 2023 16:12 CEST
Do I have to register as self-employed in Spain if I only work a few hours?
Do I have to registered as self employed in Spain if I only work a few hours a week? Photo: Yan Krukau / Pexels

Wages in Spain are generally lower than most northern and western EU countries, and certainly less than in the UK or US.

To get around the problem, many believe they will be able to supplement their income in Spain by doing odd jobs such as teaching English, giving yoga classes, selling takeaway meals from their kitchens, or giving music lessons for example.

But is this actually legal – can you be self-employed for a few hours a week and do you have to register as autónomo?

Or perhaps you don’t have a job, maybe you stay at home and look after the kids or maybe you live at home with your parents or are a student you want to just make a little bit of money on the side, without having to fully register as self-employed or autónomo – is this legal?

READ ALSO: When exactly do I need to register as self-employed in Spain?

According to Spanish legislation “Any resident in Spain, whether Spanish or foreigner with a work permit, who is 18 years of age or older and, without an employment contract, wanting to carry out a habitual economic activity in Spain, regardless of the income generated by said activity, you are obliged to register”. 

This means that whether you also have a full-time job or not, if you want to do any regular freelance work on the side, such as giving classes every week then technically you need to register as self-employed, regardless of how much you make. 

According to the law, there’s no official way to just register as autónomo per hour or per class.

Registering as autónomo also means paying into the social security system. This starts at €200 a month for those earning less than €670 per month.

This means that if you’re charging €20 per hour for an English class and you just give two per week, you will be earning €160 per month.

READ ALSO: Will you pay more under Spain’s new social security rates for self-employed?

Technically under these rules, you should be paying €200 per month in social security fees, meaning you will actually be €40 out of pocket and won’t have earned any extra money at all.

Although they are not recognised in official Spanish law, there are however two ways that you may be able to get away with doing some freelance work and not registering as autónomo.

Earning below minimum wage

The first is for those who have income below the minimum wage. In 2023, this is €1,080 per month. If this is the case you will still have to declare personal income tax and VAT, but may be able to get away with not being registered with Social Security. In this way, you will be relying on the rulings of the Supreme or High courts.

READ ALSO – Do I have to register and pay tax if I earn below minimum wage?

The High Court rulings point out that obtaining earnings below the minimum wage may reveal that the work is not indeed being carried out regularly.

Obviously, if you have a regular job as well, most likely you will not be earning below the minimum wage. But, if you don’t already have another job and want to earn a small amount, as long as it’s below €1,080 per month, you may be able to get away with not registering.

Keep in mind, you may still be investigated and it will be up to the courts to decide if you’ve broken the law or not.

Joining a cooperative

The other option is to issue invoices through an Associated Work Cooperative. After joining a cooperative, they will be the ones who issue the invoices under their name and will charge you a small commission for doing so. The money will be paid directly to them and then forwarded to you. The cooperative as a whole is charged for social security, so you won’t have to pay the whole amount.

Keep in mind that you will still be paying personal income tax and VAT on your earnings, but may save on the high social security bills.

Although there are many cooperatives in Spain, they are not all legal and many have been investigated for fraud and their members hit with huge fines.

For example, Factoo Cooperative, has now gone bankrupt and some of the self-employed associates have been left without receiving payments. In addition, many were fined and had to pay all unpaid Social Security contributions, plus the corresponding interest.

Depending on what type of work you do, some companies or people may also not be comfortable paying into a cooperative and will only pay you under your own name.

For these reasons joining a cooperative is always at your own risk and may not actually end up saving you any money at all.

To be on the safe side, if you’re considering working as self-employed in Spain, even if for only a few hours a week, you should always consult a lawyer or tax expert first to see if what you’re doing is legal. 

Member comments

  1. This is why so many people work for cash under the table. A friend of mine does crafts. She sells a few things a year at craft fairs (Christmas ornaments and Christmas, little ceramic pumpkins at Halloween, etc.). She probably makes no more than €1000 a YEAR. She goes to the shows for fun and to have an outlet for her crafts. There is no category for someone like her.

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SELF-EMPLOYED

Self-employed in Spain: Is it worth applying for the Digital Kit?

Spain's Digital Kit programme gives grants to autónomos and small companies to use for digital improvements. It sounds too good to be true, and there are indications the scheme has its problems. So is it actually worth applying for it?

Published: 23 May 2024 09:29 CEST
Self-employed in Spain: Is it worth applying for the Digital Kit?

Digital kit grants can range from up to €3,000 for sole traders and autónomos with 1 – 3 employees or up to €29,000 for companies with between 100 and 250 employees.

The amount you are given also depends on what type of digital services your business needs.

In theory, this sounds like a great idea, a way to help out struggling autónomos who need to improve their businesses and a way to boost the profits of design and other digital agencies.

In reality, however, the scheme has already faced lots of problems even though it was only introduced in 2022, and many self-employed workers and small business owners are less than impressed.

But is this true for everyone who has been granted the digital kit and is it still worth applying for in 2024?

READ ALSO – Kit digital: How Spain’s self-employed can get money for digital improvements

So what are the problems?

Long waiting times

According to several different articles written by companies and self-employed workers who have applied for the kits, the processing times for the applications are long and in many situations the digital solutions are urgent. This means that companies can’t plan and prepare properly if they don’t know when the aid will arrive. 

Application issues

In addition to waiting times, many people have complained of issues with the applications including applications that have been denied for no specific reasons, applications sent back due to errors (without saying what the errors are), and applications sent back stating missing documentation, even when all paperwork was sent in correctly. Like with any administration process in Spain, it can be frustrating.

More waiting for ‘digitising agent’ to process your needs

Once the digital kits have been granted, there is yet more waiting time for your digitising agent to process your voucher and the requirements you have, so there will be an even greater delay in actually getting the work done.

Large companies taking on the role of digital agents

While some of the problems above are to be expected, one of the worst problems that we’ve come across is that larger businesses such as banks, telephone companies, dentists and even driving schools have been taking on the role of these so-called ‘digitising agents’. They have then been subcontracting the work out to smaller design and IT agencies for a much lower fee, meaning the work is often below standard and you are not being provided with the best services.

Destroying the businesses of small design agencies

In reality, it seems that the programme has had the opposite effect, instead of helping small design, IT and cyber security agencies, it is actually harming them due to the reasons above. They are now having to compete against much larger companies and are being paid a very low rate for the same work. It also means that payment to the actual people doing the work is severely delayed.

What are the positives?

Lots of beneficiaries

According to Red.es, the Public Business Entity attached to the Ministry of Digital Transformation, so far more than 310,000 kits have been granted, which represents an investment of 1.4 billion of the Recovery Plan fund.

This means that already thousands of businesses and autónomos have benefitted from the scheme. All these companies can’t have had a bad experience, because why would people still be applying if they had?

Positive stories

There has already been positive feedback posted online via interviews and videos about various small businesses that have been greatly helped by the digital kit scheme.

One example is Väcka, a vegan cheese company based in Barcelona with between 8 – 12 employees.

They said they used to do all their accounting on Excel sheets and the digital kit allowed them to be able to do everything more efficiently and automatically. They also said that they now have a new website which makes it easier for their customers to make purchases and have a better user experience.

Rentkayaksup is a small watersport business organising excursions along the Costa Blanca. It specialises in renting kayaks, SUPs and pedal boats and has between 25-30 employees.

With the help of the digital kit, they managed to implement a digital reservation management system and improve customer satisfaction. They now also plan on increasing their social media presence through social media management, which the kit can also help fund.

So is it worthwhile?

The truth is that the application process can’t really harm you or your business, it may be frustrating and take a long time, but if it’s granted then it has the chance to be beneficial. If you need urgent solutions, howerver, you many want to look elsewhere. 

Whether the quality of the work and the service is poor or not remains to be seen as different companies have reported different outcomes. If you hardly have any online presence at all, even just a basic website may be able to help you, but if you need something more sophisticated, then you run into more issues.

Again, not much harm can be caused. If you don’t like the website the professionals create for you, or you don’t think the social media is being managed efficiently then you can always choose not to use them and pay for these services yourself.

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