Self-Employed – Important Social Security News

by

In the coming days, professional advisors will receive a Social Security notice listing their self-employed clients who made contributions in 2023 that were higher than needed, as determined by their net computable income for 2023.

This arises because 2023 saw the introduction of the radically different social security contributions system that is based on the actual net computable income of the self-employed.

Self-employed persons had the option to apply the contribution base income capped at the amount of the provisional base of the old system that applied in December 2022.

Attention: Available Options for Self-Employed

  1. Maintain the higher December 2022 Contribution Base:
    If the self-employed person wishes to keep the contribution base they had in December 2022, they must officially renounce the refund of the excess contributions they made in 2023. If this is not done, the refund will be processed automatically.
    What does this option mean? Choosing this option means having contributed more for Social Security than needed according to net income in 2023. The main advantage of this option is that the individual accumulates higher earnings for future pension calculations, i.e. a potentially higher pension on retirement.
  2. Choose a Different Contribution Base:
    If the self-employed person prefers to adjust their contribution base, they can do so within the limits set by their net computable income. In this case, the overpayment will be refunded based on the adjustment made in the contribution, according to the contribution bands that apply.
  3. Do Nothing and Wait for the Automatic Refund:
    If the self-employee takes no action, the refund will be processed automatically, adjusting to the contribution base determined by their actual net income of 2023.

Self-employed persons are encouraged to consult their advisers to find out more about this. Remember that this issue only arises if net computable income in 2023 was lower than assumed by the December 2022 contribution.

For more information concerning the new self-employed social security click here.

Spence Clarke specialises in the provision of Spanish tax, accounts, law and labour services, mainly to foreigners with interests in Spain. Our cross-border knowledge helps clients adapt to the Spanish system with the minimum of doubt and disruption. If you have any questions about this article or any other matter contact us, with no obligation, to see how we can help you.

ICAEW Chartered Accountants
Miembro de AEDAF
Certified Vegan
Economistas

Privacy Policy

Copyright © 1985 - 2026 Spence Clarke & Co.

2 Tax deadline reminders
Important deadline

Have You Prepared Your Personal Tax Declarations?

The Income Tax and Wealth Tax Declaration campaign is now underway. All tax residents of Spain are reminded that Income and Wealth Tax Declarations must be filed no later than 30 June.

In addition, Great Fortunes Tax Declarations must be submitted by 31 July.

Please contact us if you would like assistance, as we can prepare and file the declarations on your behalf.

Important deadline

Have You Prepared Your Corporation Tax Declaration?

Companies in Spain are reminded that Corporation Tax Declarations must be filed by 25 July.

Submitting the declaration within the official deadline is important to remain compliant with Spanish tax regulations.

We are available to assist with the preparation, review, and filing of your Corporation Tax Declaration.

All reminders have been dismissed.