Setting Up as an Autónomo (Self-Employed) in Spain: Step-by-Step Guide

Becoming an autónomo (self-employed) in Spain offers flexibility and independence, but navigating the legal and administrative processes is essential to operate in compliance with Spanish law. This guide provides a detailed, step-by-step breakdown of the registration process, tax obligations, and important aspects to keep in mind when working as a freelancer or business owner in Spain. Whether you are just starting or need a refresher on the latest legal updates, this guide covers everything you need to know.

Read my in-depth article about working in Spain, a legal guide for foreigners.

If you require assistance at any stage of the process, do not hesitate to contact me, José María Ruiz Castillo, for expert legal and financial support tailored to your needs as an autónomo in Spain.

How to Register as Self-Employed

Registering as an autónomo in Spain involves several key steps with both the tax authorities and the social security system. Completing these steps ensures you are properly registered and compliant with the relevant regulations.

Read my in-depth article about the types of work permits and visas in Spain.

Filing Modelo 036/037

To officially register as self-employed, you must submit Modelo 036 or Modelo 037 to the Spanish Tax Agency (Agencia Tributaria). This step registers your economic activity for tax purposes.

• Modelo 036: This form is used for more complex situations or when registering a business with a higher level of activity.
• Modelo 037: If you qualify for simplified tax procedures, you can use this shorter version of the form, ideal for individuals with straightforward business activities.

When completing the form, you must specify your business activity using the appropriate CNAE code. This code categorizes your economic activity, and selecting the correct one is crucial as it influences your tax obligations and deductions. To find the correct CNAE code, you can consult the official list published by the National Institute of Statistics (INE) or seek advice from a legal expert.

The Digital Certificate and Cl@ve

As interactions with Spanish authorities become more digitalized, having a digital certificate (certificado digital) or using the Cl@ve system is essential for autónomos. These tools allow you to securely conduct online transactions, including filing taxes and managing social security contributions. Obtaining a digital certificate is straightforward but requires a physical appointment to verify your identity. This can often be done at a local government office or through an authorized agent.

Once you have your digital certificate or Cl@ve, you’ll find it easier to manage your autónomo status online, making tax filings and other bureaucratic processes more efficient.

Social Security Registration

After registering with the tax authorities, the next step is to register with the Spanish Social Security system (Seguridad Social). This is a mandatory step for all autónomos and grants access to Spain’s public healthcare system and contributes to your pension.

As of recent reforms, social security contributions for autónomos are now based on real income, rather than a fixed minimum base. This means that your contributions will adjust according to your earnings, which could make the system more flexible and equitable. You will choose a contribution base when registering, but you must regularly update your earnings with Seguridad Social to ensure your contributions remain accurate.

For more personalized advice on how these changes may affect you or to ensure you are paying the correct contributions, feel free to contact me for assistance.

Tax Obligations for Autónomos

One of the most important responsibilities as an autónomo in Spain is managing your tax obligations. This includes filing quarterly income tax returns and handling VAT if applicable.

Quarterly Income Tax Returns

As an autónomo, you must file quarterly income tax returns using Modelo 130. These returns cover your income tax (IRPF) obligations.

• Income tax prepayments: Every quarter, you must prepay a portion of your annual income tax. The prepayment is typically calculated as 20% of your net income (income after expenses). At the end of the year, you will submit an annual income tax return (Modelo 100), where your prepayments are deducted from your final tax bill.

It’s important to note that some professionals may qualify for exceptions and can opt to file annually instead of quarterly. If you think this might apply to you, consulting with a tax expert can clarify your options.

VAT Filing for Self-Employed

If your business activities are subject to Value Added Tax (IVA), you will need to file quarterly VAT returns (Modelo 303).

• VAT rates: The standard VAT rate in Spain is 21%, but reduced rates of 10% and 4% apply to specific goods and services, such as food, medical supplies, and certain cultural services. It’s important to determine which rate applies to your services to ensure you’re charging your clients the correct amount of VAT.

Proper record-keeping is essential for managing VAT, as you must track the VAT you collect from clients and the VAT you pay on business-related expenses. The difference between these amounts determines whether you owe VAT to the tax authorities or are entitled to a refund.

If handling VAT feels overwhelming or you’re unsure about your obligations, I’m available to help guide you through the process and ensure compliance.

Managing Financial Records as an Autónomo

As an autónomo, keeping detailed financial records is crucial for ensuring compliance with Spanish tax regulations. Proper invoicing and expense tracking are key elements of financial management.

Issuing Proper Invoices

As an autónomo, it is essential to issue proper invoices to your clients. Every invoice must contain certain elements to comply with Spanish regulations:

• Your full name and NIF (tax identification number).
• The client’s details.
• A clear breakdown of the services provided.
• The applicable VAT (if any).

Invoices are not only necessary for tax purposes but also for maintaining good client relationships and ensuring payment. Ensuring that your invoices are compliant is one of the many services I can assist with.

Additional Considerations for Autónomos

In addition to managing your taxes and financial records, there are other important considerations to keep in mind when working as an autónomo.

Tarifa Plana for New Autónomos

New autónomos may qualify for a special flat rate (tarifa plana) on social security contributions. This rate offers significant reductions during the first two years of self-employment:

• In the first year, you pay a reduced contribution of around €80 per month.
• In the second year, your contributions gradually increase until you reach the standard rate.

Applying for the tarifa plana can ease the financial burden during your initial phase of self-employment, giving you a better opportunity to establish your business. For more information on eligibility and how to apply, feel free to contact me.

Read my in-depth article on how to start a business in Spain. 

Conclusion

Setting up as an autónomo in Spain is a rewarding venture, offering the freedom to be your own boss while contributing to the country’s economy. However, it comes with several important responsibilities, from registering with the tax authorities to filing quarterly tax returns and managing social security contributions. By staying informed and keeping your paperwork in order, you can avoid unnecessary penalties and focus on growing your business.If you’re considering becoming an autónomo or need help managing your legal and financial obligations, don’t hesitate to contact me, José María Ruiz Castillo. With my extensive experience in helping autónomos navigate the complexities of self-employment in Spain, I can provide you with the support you need to ensure a successful and compliant business operation.