Good news for entrepreneurs in Spain: Freelancers will no longer have to pay VAT from next year – thanks to the European Union – CSN

THEY have actually long birthed a hefty tax obligation worry in Spain, yet a brand-new instruction that enters result following year might leave autonomos (consultants) grinning.

The Treasury and freelance employees’ organisations are examining the opportunity of eliminating the demand for freelance employees and firms making under EUR85,000 to pay individual voluntary agreement (BARREL).

Presently, they need to consist of individual voluntary agreement in their billings and submit a quarterly income tax return, referred to as kind 303.

Under EU Instruction 2020/285, these teams will certainly have the choice to pull out completely, or make simply one yearly statement rather.

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Although the EU-wide policy as a matter of fact entered result in 2020, Spain has actually not yet executed it.

Yet an impending January 1 target date for EU nations to obtain breaking and ‘get rid of’ this tax obligation from some freelance employees has actually concentrated the federal government’s focus.

The European Commision is pressing participants to execute the instruction since billing autonomos INDIVIDUAL VOLUNTARY AGREEMENT ‘has an unfavorable influence on competitors’.

It really hopes that the brand-new regulation will certainly streamline the tax obligation worry and lower expenses for consultants, permitting them consequently to use costs that do not have individual voluntary agreement added.

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” In order to resolve this concern and prevent more distortions, small companies developed in Participant States apart from that in which barrel schedules must likewise have the ability to gain from the exception,” the EC included.

There are some drawbacks to welcoming the brand-new regimen, nonetheless.

Freelance employees will certainly shed the possibility to subtract individual voluntary agreement from their tax obligation expense, and they will certainly be limited to raising turn over by no greater than 10% every year– although the EU is taking into consideration elevating it to 25%.

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They will certainly likewise need to submit individual tax return.

So just how does one obtain this brand-new individual voluntary agreement exception? Although readied to enter into result in simply 6 weeks, main standards on the brand-new instruction are yet to be released.

La Caixa’s Microbank blog has actually theorized that: “You will certainly probably need to send your tax return, billings and various other papers verifying your yearly turn over is within the well-known restrictions to the Tax obligation Company.”