New contributions for the self-employed: a new system based on real income has been approved
- 26 July 2022
- Business Consultancy
What are the keys to the new RETA contribution system?
- Between the minimum and maximum contribution, there will be a total of 15 brackets, depending on net income.
- The self-employed will be able to change their contribution base every two months, instead of every four months as before.
- A reduced contribution will also be maintained for all self-employed workers (€80) who start a self-employed activity for one year, extendable to 12 months, more if it is proven that the income has been lower than the Minimum Interprofessional Wage.
- The contribution ceiling for the over-47s disappears. From 2023, the contribution limit for workers over the age of 47 will disappear, as under the new system the condition will be that their income must prove that they are in the correct contribution bracket.
- Social Security will not be exempt from the new reform, but will also be monitoring the evolution of payments and contributions.
- This new regularisation procedure will be carried out every year so that Social Security and the Tax Agency will be in contact with each other to know the real income of self-employed workers and to regularise contributions.
- The figure for the part-time self-employed is eliminated: with the creation of the new system of contributions based on real income, the part-time self-employed disappears.
- New benefit for partial cessation of activity: it will be possible to receive a benefit from four months to two years, without the need to register with the RETA and without the need to close the business. The administrative authority will be responsible for the contribution during the period of receipt of the economic benefits for cessation of activity. The benefit will be 50% of the regulatory base compatible with another activity. To be eligible, it will be necessary to have a 75% reduction in the level of sales or income when there are no workers, or this same condition for two quarters, income no higher than the Minimum Interprofessional Wage and a reduction in working hours or suspension of contracts of 60% of the workforce if there are dependent workers.