# How much tax should I charge?



## Brendan is the man (Jan 10, 2011)

*Hello.* First post 

Well I'm an english teacher giving classes to a few companies. It's all a bit new to me as I have been with only private students up till now.

I get lost when it comes to tax... er... oh dear. 

I'm exempt from ive but I must pay irpf. I was asked how much irpf they should retain and I haD NO answer at all. They stood there blinking at me for a minute and asked 7% or 16%? I didn't know. So my question is simply this: *How much irpf should my new customers be retaining?*It would be so great if you could clear this up for me.

Brendan lane:


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## Pesky Wesky (May 10, 2009)

Hey there Brendan. I'm also a freelance teacher in the Madrid area. You may find the info on this thread helps you.
http://www.expatforum.com/expats/sp...1-teaching-private-english-classes-spain.html
I pay 15%, but perhaps it's gone up - I should check it out. 
However when I started as Autonoma I charged considerably less because you were given a reduction at that time for the two first years of being self employed. I don't know if that still holds. As I said in the above thread to AloraAnn, if you go to the tax office they wll tell you. Just make sure you go armed with time and patience (although the last time I went to _darme de baja_ I didn't even have time to fill out the forms before they called me!)
You'll also need time to read the following thread about Teaching English, but at number 347 I give some info about signing on as autonoma.
http://www.expatforum.com/expats/sp...ng-spain/26226-teaching-english-spain-35.html
Hope smth here has been helpful - let us know what happens!


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## Pesky Wesky (May 10, 2009)

PS When you say THEY asked 7% or 16%, who do you mean by THEY???


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## gus-lopez (Jan 4, 2010)

I think he means the companies that he's going to be invoicing .


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## xicoalc (Apr 20, 2010)

It is 15% that you deduct but in your early years this can be less. To be honest though, as a service business you are unlikely to have huge overheads so your going to be paying about 20% tax anyway, i always did the straight 15% - makes the tax bills a little less daungting and also doesnt let on to clients you are new at what you do here in spain!


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## Pesky Wesky (May 10, 2009)

steve_in_spain said:


> It is 15% that you deduct but in your early years this can be less. *To be honest though, as a service business you are unlikely to have huge overheads so your going to be paying about 20% tax anyway*, i always did the straight 15% - makes the tax bills a little less daungting and also doesnt let on to clients you are new at what you do here in spain!


Sorry Steve, don't understand what you mean here. I have no overheads as a freelance teacher - well I have to buy books, have to have a cd player and need the occasional photocopy, but no office, no rent, no employees, no special equipment. I always get a tax rebate 'cos my earnings are so pitifully low...


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## xicoalc (Apr 20, 2010)

Pesky Wesky said:


> Sorry Steve, don't understand what you mean here. I have no overheads as a freelance teacher - well I have to buy books, have to have a cd player and need the occasional photocopy, but no office, no rent, no employees, no special equipment. I always get a tax rebate 'cos my earnings are so pitifully low...


Of course, yes you will if your earnin are low. I guess it depends what your earning are at the end off the year when the final returns are tallied up. Obviously if someone is earning a full time, reasonably high living and making a "decent" profit, and paying say 20% of their profit and their expenses are low... it is pointless to take advantage of the reduction in early years. Obviously if someone is not earning much then of course there may be rebates etc due.

The problem with tax.. both here and the UK is that everyone really is very different. Although I work here, I keep out of tax advice. I do give basic tax advice to my UK clients because I have many eyars more experience BUT I always advise that your asesoria is the best person to advise for your particular circumstances.... so many things affect your final tax bill... earnings, investments, property, etc.


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## Pesky Wesky (May 10, 2009)

steve_in_spain said:


> Of course, yes you will if your earnin are low. I guess it depends what your earning are at the end off the year when the final returns are tallied up. Obviously if someone is earning a full time, reasonably high living and making a "decent" profit, and paying say 20% of their profit and their expenses are low... it is pointless to take advantage of the reduction in early years. Obviously if someone is not earning much then of course there may be rebates etc due.
> 
> The problem with tax.. both here and the UK is that everyone really is very different. Although I work here, I keep out of tax advice. I do give basic tax advice to my UK clients because I have many eyars more experience *BUT I always advise that your asesoria is the best person to advise for your particular circumstances.... so many things affect your final tax bill... earnings, investments, property, etc*.


Yes, yes, yes, as the Spanish would say. (Have you noticed they can't normally use a single yes?)
Plesae don't take my word for it, get professional advice. However, I would say go to the tax offices and get them to explain it to you that way you don't have to pay and you have more of a guarantee that the info is correct.


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