Fredsmith

Hi,
I have only just joined this forum, so am sorry if I have posted this thread wrongly.

I am so annoyed about the way I am taxed in Spain as a self employed person. I have been registered here for 7 years, ever since I have lived in Spain. I have just received my tax declarations from my accountant for the 3rd quarter of 2011.

My earnings for this quarter were about 4,000 euros, not much but I do have some rental income from the UK.

Out of this 4K, I have paid this quarter 2352 euros that is about 58%

These payments are made up of my monthly social security , now over 300 euros per month, my accountants fee 90 euros per month and my tax and IVA.

Out of everybody I know I am the only one working legally, everybody would like to but they cannot afford it. I only pay it as I hope I may get a Spanish Pension out of it.

How much money is the Spanish government losing by having such a punitive tax system.

In the UK I would pay say £8 per month social security, no IVA on my invoices and a fairer tax rate.

I am not suprised Spain is in such a difficult situation financially, the amount of money being lost through the black economy must be staggering.

If you want to employ somebody it is even worse, that's why most bar and restaurant staff work illegally.

I really have to consider whether I can carry on paying these, perhaps I would be better off going back to the UK as I will not work in Spain illegally.

Dick Dasterdly

You've just about summed it all up and demonsrated just how foolish the system is, and as you say it simply encourages ppl.to work on the black.

I don't see it changing or the general mindset changing anytime in the near future, so maybe you'd best either join them on the black or do better for yourself back in the UK.

Best of luck whichever way you choose to go.

Rotor

I totally agree and sympathize with you ,some times when you cant bet em........

JLFS

Good post

Rosemary

Hi FredSmith

As Concierges for the Spanish section of BE we would like to say hello and welcome.

BE is a very large expat website, so if you have problems finding your way around we have concierges who will try to direct you. The moderators for the Spanish forums are Mitzyboy and Fred James, moderators are there to ensure that the site runs smoothly within the rules of BE. Problems and complaints should always be addressed to a moderador who will look into the matter and deal with it efficiently and fairly. Our members who post in the Spain Forums are friendly and helpful with a wealth of knowledge of the issues of living in Spain. At the top of the page you will find a quirkily named thread called Free Beer which is full of important and useful information. Hope you enjoy your time participating in the forums.

Please let us know if you need any further help.

Rosemary and Graham

steviedeluxe

Someone I know who also pays into the autonomo system (he has to, in order to get lucrative business teaching work) says he's able to sign on and get unemployment benefit when work is slack (normally the July/August time). Can anyone confirm this is feasible? That would make it a bit more worthwhile - the self-employed NI system in the UK does not enable jobseekers allowance (although there are other benefits available anyway)/ I agree that you shouldn't have to pay such high fees if you're only earning 4k a year.

lynnxa

yes - you baja when you're not working & alta again when you are - I know a business English teacher who does that every year - not sure if you actually get any benefits - but at least you're not paying out when you're not earning

of course, you're not supposed to be working at all while you are 'off work' - & I'm not sure if you can do that in any job, or just teaching, where it is recognised that there is no work during those months

JLFS

It just might be feasible,(not sure,though) because what he does is work for 10 months a year,which would entitle him to the 2 months with no work, to claim his accumulated dole.

this seems to fit the criteria.

bil

That's one thing the UK is very good at, getting small businesses going. I think I'm right in saying that most people in employment there are in small businesses. (ie under 50 employees.) I forget the number that are sole traders and S/E but it's immense.

Dick Dasterdly

Little wonder quite a few Spanish are moving to the UK to start businesses rather than battle against the crap system in Spain.

jimenato

Hi Fredsmith

I am in the same position as you. You have my deepest sympathy. I know about many expats who would just love to be able to go legal but simply can't afford it.

JnK

I'm in the same boat too... I nearly fainted when I got the notice from my accountant telling me how much would be coming out of my account tomorrow... in fact I still haven't quite recovered. I too have considered going illegal because it just is crippling us and it would be cheaper to pay private health care than the extortionate amounts I have to pay for the privilege of being honest. Anybody know what the Spanish self-employed think about it.

cricketman

My OH and I are both autonomo, so pay over 500 euros a month between us social security and then 20% of taxes on top

FredSmith, the amount they took out seems way too high to me, are you sure your accountant is trustworthy

There are allowances in Spain which you only get back at the end of the year, so if your income is very low then you'll get a substantial amount back at the end of the tax year, the payment normally arrives around May time

EllisG

I guess it is a very crowded boat and I don't even want a sodding Spanish pension. The worst thing I ever did was start a business in Spain and get an NIE after many happy years holidaying here. I do not see any value for money for the 400 euros approx/month I pay into their system

To anyone considering a move to Spain, a lesson. Don't get an NIE unless you want a job, especially if you live in an touristy area where you can blend in with holiday makers. There is no benefit to being legal here if you are self employed. Open a bank account before you arrive in Spain as a UK resident with your passport which should be all you need to pay bills and open utility accounts (ignore any declarations they may send you and never put so much in there that you have to worry about any deductions they make for withholding tax) . If you are on the costa del sol join helicopteros sanitarios which will give you access to a GP and back it up with a private health plan (the combined cost should be approximately 1/4 of the cost of Social security + fees.

Of course if you have children etc this gets a little more tricky but I would not hesitate giving this advice to anyone considering a move to Spain

EllisG

I wouldn't rely on this tinpot country ever paying things back. I am still waiting for a refund of IVA from last December. The only reply I ever get from my worse than useless assessor is that they are investigating it. I applied for a VAT refund for a business I closed down in the UK last year, it came 14 days later.

Civil servants around the world are notoriously lazy and incompetent...complete the job title to Spanish civil servant and you can take lazy and incompetent to a new level with a hint of added corruption