# Autonomo and pension



## Confuseddotcom (Feb 11, 2015)

Can anyone answer this for me please. I have an occupational pension from the UK, Which is more than sufficient for my needs. I am a pre retiree. In spain I do some ad hoc agency work, to keep my brain active. Generally I do not work more than 10 hours a week, some weeks non at all. I invoice the company and they pay me, not much I admit, but I am not working for the money. I will not need and do not want to pay into the spanish pension system. I do not quite understand the legality of it, but do I have to be autonomo? Do I have a choice in this? It would not be worth my while working if this was the case. Any advice would be helpful. Thank you.


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## xicoalc (Apr 20, 2010)

Hi

Yes, if you are living in Spain and working then you have to be autonomo. The only real exception for this would be if you did a very occasional job, for example in the past I worked in a specialist area as an autonomo, now I work for a business who pay my wages. If I were asked next week to do a one off job for someone I could do this and as it is not regular and just a one off I could just do it and later declare the income on my anual declaracion de renta but if I was doing this on a frequent basis then I would need to be autonomo.

You cannot legally raise an invoice for someone for services rendered unless you are registered as a business to do this. Being autonomo involves high social security payments of more than 250 eurpos a month plus of course income tax and so on so you do have to consider whether it is worth it.

Of course I am talking here what is strictly by the book and right and proper but what an individual does or chooses to do is entirely up to them (along with the consequences!!).

This is all, of course subject to the assumption that you are a full time resident (or more than half your time here) and tax resident in Spain. If you are a tax resident in another country then the rules of that country would apply.


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## NBlackbourn (Feb 11, 2015)

Hello

I don't profess to be an expert on this at all but I found some informative articles when doing research of my own (I'm in a similar situation).

If you google 'autonomo advoco' the first result should be a page on the Advoco website with lot of info.

I have not been through any of this in real life! So I can't confirm reliability or specifics (in fact I have another post on this site asking for some clarification).

Hope it's useful for you.


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## xicoalc (Apr 20, 2010)

NBlackbourn said:


> Hello
> 
> I don't profess to be an expert on this at all but I found some informative articles when doing research of my own (I'm in a similar situation).
> 
> ...


They do have a lot of useful info and i believe do distance work too, cant endorse them as never worked with them but they seem clued up!


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## thrax (Nov 13, 2008)

If you have private healthcare then you do not need to be autonomo. Just put in your tax return, pay your taxes and you will be fine. Autonomo is only really necessary if you are looking for state healthcare. You get to decide!!


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## xabiaxica (Jun 23, 2009)

thrax said:


> If you have private healthcare then you do not need to be autonomo. Just put in your tax return, pay your taxes and you will be fine. Autonomo is only really necessary if you are looking for state healthcare. You get to decide!!


I don't think that's correct

who told you that you could do that?

it isn't a case of only being autónomo to get healthcare - you just have to do it if you're working

at least that's what everything I've ever read says, and what my gestor tells me

if you are doing regular work you simply have no choice

it's the law - unless you can prove that the work is not regular as xicoalc says


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## Pesky Wesky (May 10, 2009)

thrax said:


> If you have private healthcare then you do not need to be autonomo. Just put in your tax return, pay your taxes and you will be fine. Autonomo is only really necessary if you are looking for state healthcare. You get to decide!!


But you have to be registered as autónomo to be able to invoice clients.


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## xicoalc (Apr 20, 2010)

xabiachica said:


> I don't think that's correct
> 
> who told you that you could do that?
> 
> ...


Yeah, you are right on this xabia. I mean, let's be honest, if autonomo payments were optional then anyone who is self employed (and has half a brain) would instead buy private healthcare and pump the rest into a private pension or savings for a rainy day. I too have had this conversation with Gestors who have all said the same... if you work randomly (common example is if you are on the payrole doing a certain job and then are asked as a one off to give a speach or consultancy about your speciality for a private client) then just add it on to other income in your yearly return but otherwise the monthly SS payments are obligatory (even if you are already paying SS through PAYE).


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## Guest (Feb 17, 2015)

This concerns me as well - in my case the payment of royalties, which makes the situation even greyer. Plus I have ambitions to do occasional pieces of work. But someone has told me you are not ALLOWED to work if you are a pensionista. Any thoughts on this?


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## baldilocks (Mar 7, 2010)

meetloaf said:


> This concerns me as well - in my case the payment of royalties, which makes the situation even greyer. Plus I have ambitions to do occasional pieces of work. But someone has told me you are not ALLOWED to work if you are a pensionista. Any thoughts on this?


A Spanish person, once he/she draws the old age pension MUST cease work, even if that work was self-employment. Even my barber has had to do so and to demonstrate compliance, he has closed the salon and converted it into a sitting room. There is another barber in another part of the village who has opaque plastic "curtains" covering the windows and door so that he cannot be observed continuing his profession.


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## xabiaxica (Jun 23, 2009)

meetloaf said:


> This concerns me as well - in my case the payment of royalties, which makes the situation even greyer. Plus I have ambitions to do occasional pieces of work. But someone has told me you are not ALLOWED to work if you are a pensionista. Any thoughts on this?


surely royalties are for work performed in the past? 
in which case that's just income - presumably declarable

yes I also understand that you can't work once you are in receipt of a pension


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## snikpoh (Nov 19, 2007)

xabiachica said:


> surely royalties are for work performed in the past?
> in which case that's just income - presumably declarable
> 
> yes I also understand that you can't work once you are in receipt of a pension


Which is why some people choose to defer their pension so that they can continue to work.


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## alborino (Dec 13, 2014)

It is all very odd. You have to think what would be the rules if they (the spanish government) wanted to create mass unemployment and starvation then everything makes sense. 

But it is worth investigating if you can get the UK to take the tax and pay lump transactions as in dividends for example where the UK is the revenue origin. 

I've asked many spaniards over several years to explain how these rules make sense but not one has given an answer


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## Chopera (Apr 22, 2013)

baldilocks said:


> A Spanish person, once he/she draws the old age pension MUST cease work, even if that work was self-employment. Even my barber has had to do so and to demonstrate compliance, he has closed the salon and converted it into a sitting room. There is another barber in another part of the village who has opaque plastic "curtains" covering the windows and door so that he cannot be observed continuing his profession.


I think they have tried to make this a bit more flexible recently (but not much).


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## baldilocks (Mar 7, 2010)

alborino said:


> It is all very odd. You have to think what would be the rules if they (the spanish government) wanted to create mass unemployment and starvation then everything makes sense.
> 
> But it is worth investigating if you can get the UK to take the tax and pay lump transactions as in dividends for example where the UK is the revenue origin.
> 
> I've asked many spaniards over several years to explain how these rules make sense but not one has given an answer


But the DO make sense. Why should a person who is drawing a state pension be able to continue in a job to the exclusion of a person who is unemployed, especially when the former may have a family that is by then self-supporting (married children, et al) whereas the unemployed person may be younger and have a young family to support. There can be no justification in their eyes for the state to be supporting the pensioner via his OAP and also the unemployed through the paro and any other allowances.


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## alborino (Dec 13, 2014)

baldilocks said:


> But the DO make sense. Why should a person who is drawing a state pension be able to continue in a job to the exclusion of a person who is unemployed


But the job of the retired person doesn't go to an unemployed person. It disappears in the majority of cases damaging the local economy and thus destroying jobs. 

If a retired person wants to earn parttime an extra 4000 Euros a year how does that help an unemployed person? In Spain not in the least.

If a retired person wants to hand over their skills to a youngster paying a small part time wage to an otherwise unemployed person how can they? In Spain the youngster would earn almost nothing. 

If I want to employ someone in Spain (which I did and would) the authorities make it as difficult and costly as possible. 

You only have to look at strong economies and compare them with Spain. You encourage employment and the payment of taxes and stimulation of local economies. You do not make any form of employment difficult or in some cases impossible.

And of course it should not be ignored that in Spain, as in the case of my family in Madrid, that retired person may have many dependents relying on them.


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## Pazcat (Mar 24, 2010)

How many hobby and craft sellers are there around?
I see loads on facebook and lets be honest most of them are retired and are just keeping busy by working with a scroll saw or knitting in their spare time.
It's by no means an income that could cover autonomo payments and probably it's not intended to be. Sure it's slightly different than the OP but same principle.


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## baldilocks (Mar 7, 2010)

alborino said:


> But the job of the retired person doesn't go to an unemployed person. It disappears in the majority of cases damaging the local economy and thus destroying jobs.
> 
> If a retired person wants to earn parttime an extra 4000 Euros a year how does that help an unemployed person? In Spain not in the least.
> 
> ...


But you are only considering the self-employed, what of those who are in employment - their retirement could create an opening for an unemployed younger person.


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## Chopera (Apr 22, 2013)

alborino said:


> It is all very odd. You have to think what would be the rules if they (the spanish government) wanted to create mass unemployment and starvation then everything makes sense.
> 
> But it is worth investigating if you can get the UK to take the tax and pay lump transactions as in dividends for example where the UK is the revenue origin.
> 
> I've asked many spaniards over several years to explain how these rules make sense but not one has given an answer


I think the answer relates to the Spanish state pension/ponzi scheme. In order for it to be sustainable they must require everyone who is working to pay in - that's why you have to either be an autonomo or employed by a comapny in Spain, and that's why the autonomo costs are so high. They need everybody working to be paying into the state pension system in oder to pay out. As with every ponzi scheme, those who got in first are now enjoying fantastic payouts in the form of early retirements and generous pensions, while the younger generations will have to pay for it.


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## alborino (Dec 13, 2014)

baldilocks said:


> But you are only considering the self-employed, what of those who are in employment - their retirement could create an opening for an unemployed younger person.


Baldilocks very fair point but industry can make those decisions themselves. 

Where a person reaches retirement but has great skill and experience the company should be able to retain them part time. 

Where a person reaches state retirement age and they want to let that person go so be it. After all employing a youngster will cost less and thus make the firm more profitable. 

But to not only kick the person out but then say "You are a low earner so we will put major restrictions on you as you cannot defer your pension" but for the high earner "well you can work as you want because you have the means to defer your pension" seems like screwing the less well off to me.

So the rules are there to damage business and hit those who earn the least. And the results we see


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## Confuseddotcom (Feb 11, 2015)

Many thanks for all your replies. All sorted now


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## xabiaxica (Jun 23, 2009)

Confuseddotcom said:


> Many thanks for all your replies. All sorted now


how did you deal with it?

I'm sure you aren't the only person in your position & your experience could help others


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## Confuseddotcom (Feb 11, 2015)

We took advice from a solicitor as our circumstances are probably different from others as we work for a care agency. They give us the work and we fill in a time sheet, which they call an invoice. Some of us spoke to our solicitors who said basically because of the low wage(5 hours work would only pay €35) we did not have to pay SS. We would have paid far more out than we earned.


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