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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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For members

WORKING IN SPAIN

What’s the law on having two jobs in Spain?

With the current cost of living crisis, working more than one job is becoming more and more common, but what are the rules on working multiple contracted jobs in Spain and the tax implications of this?

Published: 25 June 2024 13:24 CEST
What's the law on having two jobs in Spain?

Often it’s necessary to have more than one job at a time, particularly if they don’t pay well and you’re struggling to make ends meet.

In fact, historically that is part of the reason why establishments stay open so late and why siestas were so common – because people would have one job in the morning and then go home for a rest before starting their second.

This is still commonplace today and is in fact becoming more and more popular, with the rise in the cost of living, driving an increasing number of people to take up a second job.

Whatever your reasons for having two jobs or more – to save up more money or gain extra experience and work your way up, there are some financial implications you should be aware of.

What does the law say?

Currently in Spain, there is no restriction that prevents a person from having a second job, with two contracts in two different companies, for 80 hours a week.

According to data from the first quarter of this year from the Active Population Survey (EPA) prepared by the National Institute of Statistics (INE), the number of people with a second job in Spain stands at 591,300, although according to affiliation data of Social Security, some 800,000 people have more than one position.

This trend has been seen in each quarter of the EPA since 2022 and, right now, is close to a historic number.

Categories you should be aware of

There are two types of categories when you work in multiple jobs in Spain – these are pluriempleo and pluriactividad. Pluriempleo literally means multiple employment. This is understood as a person who works as an employee in two or more companies under the same Social Security regime.

In this way, it differs from pluriactividad or multiple activities, which is when people work for others and have their own business at the same time or their second job is under a different social security regime.

For example, if you work as a hotel receptionist in the morning and then in a restaurant at night, these positions are considered to be part of the same regime, but if you work in a hotel in the morning and then as a nurse in a hospital at night, these are two different careers and therefore social security regimes.

If you’re self-employed as well as having a contract job, this is a slightly different situation. To find out more, read our guide below. 

READ ALSO – Self-employed in Spain: What are the tax rules if you do two or more jobs?

What are the tax and social security implications?

If you have two separate jobs, you are required by law to report your situation to Social Security, and to each of the companies you’re employed by.

When it comes to the Tax Agency, it’s important to note that you are obliged to submit your yearly Income Tax return (Renta), when you are paid by more than one employer and your income exceeds €22,000 per year.

READ ALSO – EXPLAINED: The key changes to Spain’s 2023/2024 annual tax return

In 2024, the maximum social security contribution base for employees has been set at €4,720.50 per month. This means, that regardless of whether your income from two positions exceeds this amount, the social security base will not be more than this.

The amount of IRPF (Personal Income Tax) must also be taken into account. If you are combining two contracts, it’s important to calculate the withholding tax.

This is because companies calculate personal income tax based on your annual compensation expectations. They do not take into account the existence of another job, so they apply the discount depending on what they are paying you only.

This means that they will keep less than what they should and when you’re filling out your Renta yearly income tax return, you will most likely have to pay the extra to make up the difference. 

In this case, you should request that both companies calculate personal income tax according to your earnings, so that you can get a good idea of the amount you have to pay working two positions.

You may also consider hiring a gestor or accountant to file your yearly tax return for you if you have a particularly complicated situation and work three or more jobs for example. 

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