A lot of people living in Spain and thinking of starting their own business are put off going self employed by the high fixed social security contributions.Anyone registering as “autonomo” with the Tax Office is also obliged to sign up for self-employed social security which costs a minimum of €250 a month.If you are starting a small business with uncertain revenues or if it is onlya minor concern where you know the income is going to be pretty minimal this is very offputting.
The situation is worse when you do not need the social security because, for example, your family has private health insurance or you do not need to make any more state pensions contributions (e.g. because you paid the maximum already in the UK).
There is a possible exemption which may make a small business viable in this position.If your are registered autonomo but this is not a full time regular income generating occupation then you can be exempt from joining autonomo social security (known as “RETA” or Regimen Especial Trabajadores Autonomo ).The law does not give a hard and fast definition of how an “occasional” autonomo should be classified but case law has suggested that, in the absence of any other factors, earning less than the annual minimum wage would suffice.
The minimum wage, or the “salario minimo” or “salario minimo interprofesional” (“SMI”), is €7,599.60 for 2010.It is most commonly referred to as a monthly amount ( currently 633,30), and is changed annually by the Bank of Spain.
Once someone earns more than this monthly amount they won’t be able to claim the exemption from social security. It should also be noted that they won’t be able to claim any benefits or benefits from social security while they are not making payments.
More information can be found at the new Autonomo page ofthe Advoco website which also includes a video guide to the autonomo.
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