Can I be both self-employed and an employee in Spain?
Are you in Spain and wondering if it is possible to work legally as a self-employed person and as a salaried employee at the same time? You may be surprised to learn that there are indeed certain circumstances under which you can be both self-employed and an employee in Spain. Read on to find out more about what it takes to have a dual career as a self-employed person and an employee in Spain.
Sometimes employees or salaried workers consider starting their own business. However, the option of leaving their permanent job to dedicate themselves fully to starting a business involves doubts and risks: this is why many people wonder whether it is possible to be self-employed and employed at the same time. In other words, if they can launch their own project without leaving their job.
You can be self-employed and employed at the same time in Spain, but make sure that your company allows you to do so. This means that you have not signed any exclusivity or non-competition clauses. Here are all the details if you want to be self-employed and work for another company at the same time.
Differences between pluriactivity and pluriemployment
The first thing you should know is that moonlighting and moonlighting are different concepts. Multiple employment involves people who work in 2 or more companies at the same time but who remain in a single scheme, the General Social Security Scheme.
Whereas moonlighting is when a person contributes to more than one Social Security Scheme. For example, the self-employed and the General Social Security Scheme.
As you can see, pluriactivity is your situation if you want to work in a company and be self-employed at the same time.
Know all the relevant laws and regulations related to salaried and self-employed work in Spain.
When considering both salaried and self-employed sources of income in Spain, it is essential to ensure that you are aware of all relevant laws and regulations relating to self-employment. This includes understanding the taxes and deductions that must be paid on self-employed income, as well as being aware of any potential legal requirements that must be met. In addition, everyone should ensure that they have adequate insurance cover for any type of work they undertake in Spain.
Asesoria Orihuela Costa are experts in employee and self-employed law.
Allowances on the self-employed contribution
As you are already paying Social Security contributions as an employee, your self-employed contribution will be lower and you will pay a lower contribution than a self-employed person who pays the minimum wage.
The allowance for a self-employed person in pluriactivity is as follows:
- First 18 months as self-employed: 50% reduction of the minimum base.
- Next 18 months as self-employed: reduction of 75% of the minimum base.
There are two requirements to be able to obtain this bonus:
- Register with the Social Security for the first time as self-employed in the RETA.
- Start the situation of pluriactivity in that registration.
This bonus is not compatible with other bonuses, such as the flat rate. You can apply for one or the other, but not both.
Make sure your accounts are up to date and complete when you receive both types of income.
When earning both salaried and self-employed income in Spain, it is important to keep careful accounts at all times. It is important to accurately record both sources of income, expenses and deductions to ensure that everything is paid correctly. By keeping a complete record of your transactions, you can ensure that all parties involved are properly accounted for and avoid potential legal problems arising.
Paying taxes
When considering the option of pursuing a dual career as a self-employed and salaried worker in Spain, it is important to understand the tax implications of self-employed income, which is different from salaried income. Depending on the type of work performed as a self-employed person, you may be liable to pay additional taxes such as IRPF (Impuesto sobre el rendimiento de las actividades económicas), VAT (Impuesto al Valor Agregado), VAT (Impuesto al Valor Agregado), etc. (VAT).
The payment of taxes also has some nuances that should be taken into account. In the case of paid employment, the corresponding income tax withholdings from your paycheck will be applied.
When it comes to justifying self-employed income, in addition to the IRPF, you will have to make a quarterly VAT settlement. Although this is more complex, it is by no means impossible. What you will need to do is pay attention to your tax and income tax returns, because it is relatively easy to forget any of the taxes or quotas, with the consequent risk of penalties.
Asesoria Orihuela Costa can help you avoid problems with the tax authorities.
Is it possible to remain in multiple employment indefinitely?
Yes, it is possible to remain in the same job indefinitely. The problem with this is that it can be problematic in the long term, because after 3 years the bonuses for the self-employed will be eliminated. In addition, you should check whether it is worthwhile because the rights or considerations, in terms of disability or accident benefits, will change. Consequently, you need to have a high level of income in both cases to make it profitable.
Are there any legal limitations to moonlighting?
Yes, in principle there is for some civil servants or members of state authorities (judges). In this case, it will be necessary for them to provide a declaration of compatibility justifying that there is no interference between their occupation and the pluriactivity. Only if it is approved by the Administration can it be exercised.
Are there any age restrictions for moonlighting?
Yes, because in Spain there is an age limit for self-employment. A person cannot be self-employed if they are not of legal age, so in order to take advantage of the pluriactivity, you must be at least 18 years old.
Make sure you have all the necessary licences and permits to operate legally as a self-employed worker.
Depending on the type of work you do as a self-employed worker, you may need specific licences and permits from the Spanish government. This may include a special registration number and proof that all necessary taxes are paid. Without these documents, you could be subject to fines or other sanctions. It is important to research the regulations applicable to your particular type of work, as well as any additional requirements from local or regional administrations. Also, be sure to keep up to date with any changes in Spanish tax legislation to remain in compliance with all legal obligations.
Financial security and retirement
You could receive two pensions, one as a self-employed person and the other as an employee, as long as you have contributed for at least 15 years in both schemes.
If you do not reach 15 years in either of the two options, you can accumulate your contributions in the scheme to which you can contribute.
