Self employed and moving to Spain, Help!
 

Hi there,

I'd really appreciate some advice please!
I am moving to the Costa Blanca next year with my husband and little girl.

I work at the moment as a freelance illustrator, I do it all digitally and via email so I can do it anywhere. It's just the tax issues that confuse me. I don't make a huge amount of money, about £ 6000 a year, so i don't actually pay any tax here in the UK.

My Husband has a job lined up so will be 'plugged' into the Spanish system.

I have heard that if you are self employed in spain that you still have to pay each month even if you aren't earning anything!

I get paid in Pounds into my UK Barclays account

Any advice would be appreciated!!!
Thanks

Re: Self employed and moving to Spain, Help!
 

Hi Vicky P

Yes unfortunately you will have to pay around 250 euros per month social security for being self-employed in Spain - it doesnt matter if you get paid in pounds as you will be tax resident in Spain

It is not icome tax, it is your social security contributions for health and pension.

Re: Self employed and moving to Spain, Help!
 

As self-employed yourself, you would have to pay the SS (NI) contributions which are in excess of 260 euros per month irrespective of how much you actually earn. This is still not enough to actually cover the cost of health, pension etc..

If your husband is also self-employed, then he too will have to pay this figure. If he has a PROPER work contract, then his employer will pay most of it.

Even if you are paid in sterling, once you are resident here (after 90 days for tax purposes), then you will have to make a Spanish tax declaration and cease making one in UK. It may well be that you won't have to pay any tax here either, but you still need to make tax returns.

Hope this helps.

Re: Self employed and moving to Spain, Help!
 

Thank you very much for your speedy replies!
My Husband will have a proper work contract

Would I have to pay anything if I didn't work at all?
Some months I don't sell anything...hmmm.
My daughter is only 2, so I can only work a couple of hours a day.

Thanks, Vicky

Re: Self employed and moving to Spain, Help!
 

You would need to officially sign-off as self-employed in advance if you are not going to be working that month, and then sign-up again in those months you would be working, which is very tricky to plan and administer

If you didnt work at all then your healthcare would be covered by your husband's work contract

Re: Self employed and moving to Spain, Help!
 

Thank you! That does sound tricky!
I'm just a stay at home Mum trying to make a bit of extra money...
I was going to carry on paying my 'stamp' in the UK, so I could still get a pension.

Is there a low earnings tax exemption in Spain like the UK?

Thanks again, Vicky

Re: Self employed and moving to Spain, Help!
 

Yes, I think it is around 6000 euros per year

But that is for income tax. You have to pay the 250 euros per month social security payments regardless of your income

Re: Self employed and moving to Spain, Help!
 

Thanks for your help!

Re: Self employed and moving to Spain, Help!
 

Hi Vicky
I don't know if this helps, or maybe you already know but you can pay "voluntary" NI contributions to enable you to get your state pension.
There are 2 classes of payments so you need to work out which one applies to you(there's quite a difference between the 2) apply for it then HMRC will confirm the class that applies to you, then you will start paying.
If you will be staying in Spain permanently then you'd keep paying until you'd accrued 30 years worth of contributions, which would include the time you'd paid whilst in the UK.
This is off the top off my head so hopefully it's accurate but you'll be able to check it all out on the HMRC website.
I hope this helps:)

Re: Self employed and moving to Spain, Help!
 

I'm not sure this is true once you're resident in Spain. T believe you can't continue to pay NI but you should check. there is a DWpinspain member on here who should help with this question but you may need to Private message them. I think you then have to be an 'ama de casa' housewife or an 'Autonomo' here.I agree with the poster who says that you should keep going on and off the register as your work comes in. Get a gestor with a reasonable monthly rate to do this for you. It'll save you a fortune in the longer run. Maybe if you get some work coming in in October and some in in December for example. you can arrange that you complete and bill the work all in the same month. This will save you on Autonomo payments at least. I don't know if there is a similar individual allowance like there is in England but if you are treated as an individual for tax purposes you may get some tax back if you're very low paid. Remember you have to do a tax declaration every 3 months and pay IVA from the very first pound. So you might find you're better off being a mum for a while! Maybe you should spend a year illustrating your own book! :D
Hope you enjoy your time here though. The light is very conducive to creativity!

Re: Self employed and moving to Spain, Help!
 

Angie,
I actually started paying my Voluntary NI contributions after I became resident in Spain which HMRC were aware of, so unless they've made a huge error then you can pay once you're resident here... I think they have made an error in regards my payments, they sent me a letter saying I don't have to pay anymore as I've paid up the required 30 years, I'm 45 so I know I definately haven't paid 30 yrs worth as I'd need to be 46 at least. I'm awaiting their reply on that "mistake":unsure:
They did say the payments only cover the pension though and not NHS care as that is UK residency based apparently.

Re: Self employed and moving to Spain, Help!
 

Yes you can pay voluntary NI in the UK, but that doesnt help you much if you will be working from Spain

It may be an option if the OP decides not to work

Re: Self employed and moving to Spain, Help!
 

Apologies if wrong, but from memory in the guidance notes for the form I filled in, it said you could pay Voluntary Class 3(I think that's the one I paid) whether you were working abroad or not, but they are only for your pension and bereavement benefits. There was plenty other criteria but working or not was not one of them....I think.

Re: Self employed and moving to Spain, Help!
 

Sure, but then you'd be paying UK and Spanish social security payments which is a bit pointless. There is an EU agreement that the pension entitlement can be added up from the number of years you contributed in each country

Re: Self employed and moving to Spain, Help!
 

This is a very interesting thread then. Can anyone advise me if it's possible for my husband (who is currently unemployed here but not receiving any benefits from either country) to continue paying NI in the UK for his pension rights? Obviously he can't afford to pay here at 260+ a month.