Spain Joins the Minimum Income EU Club

In 2008, the European Commission Recommendation on active inclusion, set out the
common principles and practical guidelines for a comprehensive strategy based on three
integrated pillars: adequate income support, inclusive labour markets and access to
quality services.

The 2013 European Commission’s Social Investment Package again reiterated the importance of an active inclusion approach and stressed the importance of adequate minimum income support however it did acknowledge that “most Member States have some sort of minimum income scheme”, although went on to comment that “the adequacy of these schemes can often be improved, stating that the level should be high enough for a decent life and at the same time help people to be motivated and activated to work.”

The Spanish Government has now agreed to implement this same scheme to ensure that citizens of Spain receive a minimum income package: Ingreso Minimo Vital (IMV).

For an individual living alone without any income, the maximum they would receive would be 461,53€ (that all important 53 cents…) per month, equating to 5,538€ p.a.

The criteria for being eligible for this IMV is that the recipient has to:

  • be between the ages of 23 and 65.
  • must have lived in Spain for a minimum of 1 year.
  • has to prove that they have been living independently, i.e. on their own, for a minimum of 3 years, although this does seem a little strange to the writer, as they only have to have lived in Spain for the 1 year, will the authorities really check past living arrangements that were outside Spain…?
  • the average monthly income for the previous year must be at least 10€ less than the IMV, as mentioned above. One could ask why…..
  • the minimum wealth of the applicant, excluding their home, must be less than 3 times the annual IMV, ie a limit of 16,614€.

The last two points are to determine the ‘economic vulnerability’ that the applicant has to comply with.

As my researcher commented when reporting to me on this: “Really?? why on earth are they making this so complicated??”, and he is Spanish.

Applications can also be made jointly as an ‘economic unit’ (Unidad de Convivencia), namely a married couple, family with children, you get the picture, all living together and being economically dependent on each other, the parents etc.

You won’t be surprised to read that there are 14 different types of ‘economic units’ (nearly beating the number of different income tax rates Spain has, I refer you to the Spence Clarke Income Tax Guide, to discover these wonders…..).

Depending on the number of family members, the monthly payment can be between 461,53€ and 1,015.37€.

Applications have been possible since the end of June 2020 and are made through the Social Security office. A typical application should take 10-15 days to process and approve with the payment being received on a monthly basis, normally at the beginning of each month. Those still waiting for their ERTE payments over three months later, are probably reading this with a tad of scepticism.

Albeit has taken Spain a fair minute to get on board with this, they should be applauded for having now joined this very worthy and very much needed EU initiative.

Although a pity that the Spanish politicians are claiming this as their own initiative, shame on you. Where is the press commentary exposing this false claim mmh?

Thank you for reading.

Spence Clarke & Co specialises in the provision of Spanish tax, legal, audit and accountancy 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.