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Date Published: 13/12/2024

New contribution rates for self-employed workers in Spain in 2025: Who benefits, and who loses out?

In a nutshell, lower-earning autónomos in Spain should see their monthly payments go down, but higher-earners will pay the price

Starting January 1, 2025, Spain’s self-employed contribution system will undergo a significant change. This new system aims to make contributions more equitable by linking them to the actual net income of self-employed workers.

The old system, where individuals could freely choose their contribution base, will be phased out.

Most autónomos already knew the changes were coming in the New Year but the authorities have only just submitted the draft of the 2025 contribution order, so now tax payers have access to the official figures.

What’s changing?

From next month, self-employed workers must inform the Social Security of their expected income for the year. Based on this forecast, they will be assigned a contribution range.

Autónomos can adjust their contributions up to six times throughout the year if their income varies significantly.

Here’s the rub: for the first time ever, the Social Security will review the actual declared income through the Income Tax Return and if the freelancer has underpaid their contributions, they’ll face a tax bill.

Of course, if the autónomo has done everything correctly, no adjustment will be made and if they’ve overpaid, they’ll be due a refund.

A word of caution: as most self-employed people in Spain can attest to, the tax authorities are very quick to embargo a bank account without warning if they’re owed money. On the other hand, it can take them months to issue a refund, so it’s really better to get it right from the get-go.

So, what will autónomos pay in 2025?

The table above shows the new minimum and maximum bases that will determine the contributions that freelancers must pay to Social Security in 2025, according to the range of net income they obtain.

As an example, self-employed workers who fall into the first six brackets and take home less than 1,700 euros net, will have a lower monthly fee. Thus, if they contribute on the minimum basis, they will have an annual reduction in their fee that will range between 80 and 428 euros, depending on the bracket they fall into.

However, it’s a different story for autónomos who are in income brackets higher than 1,700 euros. In these cases, if they contribute on the minimum basis, their monthly fee will be increased and will amount to an annual increase of between 272 and 970 euros, depending on the bracket they are in.

Moreover, "from January 1, 2025, regardless of the net income obtained by self-employed workers, the maximum contribution base will be 4,909.50 euros per month," the document states.

Intergenerational Equity Mechanism (MEI)

Another new feature in self-employed contributions in 2025 is the Intergenerational Equity Mechanism (MEI).

Introduced in 2023, the MEI aims to ensure the sustainability of the pension system. It affects both salaried workers and self-employed workers.

In 2025, the MEI will increase from the current 0.7% to 0.8% of the contribution base.

What this all means is that all self-employed workers will also see a slight increase in their contributions.

For instance, if a freelancer’s contribution base is 2,000 euros, the additional contribution will be 0.1% of 2,000 euros, which is 2 euros per month or 24 euros per year.

Newly registered autónomos

The one thing that won’t change in 2025 is the discounted contributions for newly-registered self-employed workers. Autónomos who start up a business in the New Year will still be able to enjoy a reduced fee of 80 euros per month for the first 12 months.

There’s little doubt that the self-employed have a hard time of it in Spain and adjusting to the new system will definitely take some getting used to. However, the take-away is that some planning and control from the beginning will benefit all autónomos in the long-run if they want to avoid paying Social Security debts.

In other news: Spanish pensions will shoot up by 600 euros next year

Image: Archive/Social Security

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