Bureaucracy is one of the main problems encountered by the self-employed in their day-to-day lives and can be a serious impediment in carrying out their activity. And it is that according to the first Report on the Declaration of Income and Spanish Tax Policy prepared by TaxScouts, the online platform that simplifies the presentation of taxes for self-employed workers and individuals, 92% of self-employed workers believe that the public administration should simplify the amount of bureaucratic procedures and thus facilitate and encourage entrepreneurship.
The problems derived from a confused and inflexible bureaucracy are many, but among them is the possibility of making mistakes, either due to carelessness or lack of understanding, and in the long term, these errors can have more important consequences, such as sanctions or the impossibility of develop work activity. In this context, TaxScouts, breaks down the main errors and sanctions that the self-employed can incur and how to avoid them:
Late registration
Self-employed workers who do not register within the indicated period will have a 20% surcharge, as well as the loss of the right to bonuses and other reductions on the quota, such as the flat rate of €60, which will go to be €80 from January 2023. An example is when the date of registration with Social Security and the date of registration with the Tax Agency are different, the possibility of benefiting from the flat rate is lost, so the self-employed would have to pay the minimum freelance fee of €294, which would translate into a difference of more than €2,800 during the first year of activity, according to current fees.
Having debts with Social Security
Failure to pay social security contributions on time and to Social Security has different levels of sanction, depending on the infraction, ranging from economic fines to prison terms in the most extreme cases.
In the case of self-employed contributions, for example, paying a fee late within the following month would have a surcharge of 10% and from the second month of 20% and, in addition, if the flat rate is being applied, we will lose the bonus of the flat rate during the months in which it has not been paid on time, plus the surcharge, so that a delay in the payment of €60 means having to pay more than €300 at current rates.
In the case of having dependent employees, violations related to contributions or labor relations give rise to higher sanctions and fines can range between 626 euros and 6,250 euros, in the most serious cases.
Presentation of documentation after the deadline
In the case of having submitted the model 303 after the deadline, the self-employed face a surcharge, not a sanction, although this can come in the event that the self-employed worker allows so much time to pass that the Treasury sends a request. This surcharge will be 1% for each month of delay and, in case of reaching 12 months, a surcharge of 15% plus interest on late payment will be applied. In the event that the declaration is negative or informative, the penalty for late delivery may be €200, which would be reduced to €100 due to reductions in paying on time.
Not making the payment correctly
Quarterly models, due to their very nature and the usual haste of the self-employed, are usually subject to a greater number of errors, which cause a payment greater or less than required and which will be considered as an infraction by the Tax Agency. Faced with these possible situations, the process of the Tax Agency is to regularize the tax model, removing the non-deductible expense and introducing the sales invoice that was misplaced and, later, recalculating the actual result of the tax. If it demonstrates bad faith, such as the inclusion of false documentation, there may be proportional sanctions between 50 and 150%, and can reach up to €3,000.
“Taxation for the Spanish self-employed can be complicated and cumbersome, especially if we compare ourselves with other neighboring countries such as Denmark, where the registration process is free, online and fees are not paid, but based on billing. Professionals in our country have to dedicate a lot of time to the procedures of the Treasury and Social Security: the different registrations, the quarterly taxes… And all this, in addition, facing confusing and long procedures, which can cause a lack of understanding and errors. at the time of presenting them that, ultimately, result in sanctions of various kinds. Professional and accessible help such as the one offered by TaxScouts can be of enormous help to them, facilitating their activity and, above all, guaranteeing and protecting their interests and rights” says Jaume Suñol, General Manager of TaxScouts Spain.
