The Government has managed to close with the social agents the reform of the contribution system of the self-employed. A cultural change that will force affiliates to CHALLENGE to take out the calculator to reformulate their quotas. Well, starting in 2023, each self-employed worker will pay according to their net income or “real income”, as they have baptized it since the Social Security. The new quota system will go from 230 euros -the lowest- and up to 500 euros -the highest-. According to preliminary calculations by the Ministry, three out of four self-employed workers will pay the same or less with the new system, while the remaining fourth will see their mandatory contributions increased.
Until now, self-employed workers paid a monthly fee based on their preferences and regardless of the income they handled. Unlike, in this sense, with wage earners, to whom one section or another of personal income tax depending on how large your payroll is. A willfulnessthat of the self-employed, which has meant that until now the vast majority of the group opted for the minimum quota, of €294. Either because their income did not allow them to make more contributions to ensure better future benefits, or because they preferred to keep that extra money in their pocket and spend it on other things. As of 2023, the fee paid by each self-employed worker will depend on the net returns – a kind of calculation of benefits – of his activity.
How will those net returns be calculated?
The spirit of the new scheme is to add income and subtract expenses. And the number that derives from that calculation must be crossed with the table of 15 sections that Social Security has defined and that each year will be reviewed in the State’s general budgets. If the self-employed person is in the lower brackets, he will pay less and if he is in the higher brackets, he will pay more. A detail that stands out from the self-employed organizations is that, although the fee is calculated monthly, the income and expenses are calculated annually. For example, if the returns (income minus expenses) per month are less than 670 euros, the self-employed person must pay a fee of 230 euros in 2023.
The key to the new system is deductible expenses, since income is a relatively simple part of the equation. Income is all that derived from economic activities and earnings from the work of the self-employed.
What expenses are deductible?
In the scheme of the new reform, all those that the Treasury already accepted are counted as deductible expenses. These must meet three requirements: they must be linked to economic activity (something that invites divergent interpretations), they must be able to justify and they must be accounting registered. Classic examples are the purchase of materials or raw materials, the salaries of workers in charge, the rental of premises or material, services to companies, financial expenses or amortizations, among others.
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Once the self-employed have the deductible income and expenses for the year, they must add a additional 7% those expenses as “hardly deductible” expenses, without having to credit them. This additional bonus is designed to cushion the balance of expenses and de facto lower the fees, a card put on the table by the Government to attract the social partners to the agreement.
Can you change the fee?
The quota election is formally volunteer and it is based on the estimates that the self-employed person makes of his exercise. However, if during the year he has earned more than he had anticipated, the Treasury knows what income he has had and will claim the pending contributions that would have corresponded. And, on the contrary, if the self-employed person has made a better estimate of contributions than formalized, he may at the end of the year demand that the public treasury return the difference. The self-employed worker may change up to six times a year fee to adjust to the evolution of your business.