- What it means to be a self-employed professional working abroad
A self-employed professional working abroad is someone who resides in Spain but temporarily works in another country without changing their usual residence or primary economic activity center. This includes providing services or conducting economic activities abroad for a limited period.
- Applicable regulations
Self-employed professionals working abroad are generally subject to the social security laws of the country where they work. However, under certain conditions, they can continue contributing to the Spanish system during temporary assignments, particularly under EU Regulation 1408/71 or bilateral agreements.
- Conditions to be considered self-employed abroad
- Residence: Maintain residence in Spain.
- Duration: The assignment is usually temporary, generally less than 183 days per year in the same country. This limit may vary depending on bilateral agreements.
- Registration in the destination country
In most cases, it is not necessary to register as self-employed in the destination country if the assignment is temporary and does not involve a permanent establishment. It is essential to verify local laws and the nature of the services provided.
- Tax obligations
- Taxes in Spain: Quarterly tax obligations remain the same.
- Tax residency: If the stay exceeds 183 days, tax obligations may arise in the destination country, and the individual may no longer be taxed in Spain.
- Double taxation treaties: These agreements help avoid paying taxes in both countries.
- Social Security
- Contribution in Spain: During a temporary assignment, self-employed individuals can continue contributing to the Spanish social security system using Form A1 within the EU or specific procedures for other countries.
- Extensions: Initial periods are limited to 12 months, extendable up to 5 years with Form TA.300 and Form E-101.
- Requirements for working in another country
- Tax documentation: Registration in the Spanish Tax Agency's business registry.
- Healthcare coverage: European Health Insurance Card (EHIC) or bilateral agreements.
- Tax filing: Comply with tax obligations in the destination country, if applicable.
- Benefits
- Avoid double taxation: International treaties facilitate tax compliance.
- Healthcare access: Medical coverage in the destination country through the EHIC or bilateral agreements.
- Work flexibility: Enables work in different markets without changing tax residency.
- VAT for international services
Services provided outside Spain may be exempt from Spanish VAT according to localization rules. However, VAT registration may be required in the destination country, depending on the type of service and income.
- Exceeding the 183-day limit
If a self-employed professional exceeds 183 days abroad:
- Tax residency: They may be considered a tax resident in the destination country and must fulfill their tax and social security obligations there.
- Assignment extension: Managed through Form TA.300 and Form E-101 to continue contributions in Spain.
- Initial procedures and required documentation
- Summary of authorized periods
- Initial assignment: Up to 12 months.
- Ordinary extension: Additional 12 months.
- Further extensions: Up to a maximum of 5 years, including previous periods.
- International agreements
Spain has treaties with numerous countries to avoid double taxation and coordinate Social Security. These agreements simplify the tax and labor obligations of self-employed professionals working abroad.