One of the many responses to the coronavirus crisis has been the approval, in a very short period of time, of a wide range of regulations to mitigate its effects on the economy. Therefore, there may be some confusion about the rights that self-employed workers may exercise in these peculiar times, among others. These are the ten measures approved by the Government focused on alleviating the difficulties of this category of workers and the clues to follow to benefit from them.
Tax payment deferral
The taxes that a self-employed owes to the Treasury in the period from March 13 to May 30 of this year are not waived, but their payment can be postponed. “It is a deferment of six months, not up to six months (…), with the first 3 months without interest”, it appears from the website of the Tax Agency. “Yes [el contribuyente] you want to pay earlier, you can do the same as in any ordinary deferment or installment, [es decir,] get payment letter and pay. If you do it before three months, it will not earn interest “, they insist.
In this way, self-employed workers and companies with a turnover that does not exceed 6,010,121.04 euros in 2019 may postpone the payment of VAT or personal income tax, among other taxes, for a maximum amount of 30,000 euros. To do this, they must enter the electronic headquarters of the Tax Agency and follow these guidelines.
Postponement of quarterly returns
Self-employed workers, in normal times, would have had until April 20 to present the self-assessments corresponding to the first quarter —among them, VAT— and pay them to the Treasury. However, the Government decided to extend this period until May 20Although, if the chosen form of payment is direct debit, the filing period extends only until May 15.
Only taxpayers whose billing has not exceeded 600,000 euros in 2019 will be able to take advantage of this measure. If, at the time of filing the self-assessment, on May 20, they opted for the aforementioned six-month postponement of the payment of the tax debt planned for between On March 13 and May 30, the self-employed worker would have until November 20 to deposit that money (and until August 20 to avoid paying late interest), according to the Tax Agency.
Social Security fee
Regarding Social Security contributions, the self-employed worker has two options: avail of the six-month moratorium on the quotas of May, June and July, without interest, provided that the activities carried out have been suspended with the declaration of the state of alarm; or to postpone the payment of their debts with Social Security that they would have had to pay in April, May and June, but with the application an interest of 0.5% (about half with respect to the interest of habitual delay). As regards the April quotations, it was only possible to request a deferment of payment, and the July quotation may only be subject to a moratorium. Whether you want to take advantage of the postponement or the moratorium, the application must be submitted in the first ten days of each month.
Moratorium requests must be submitted through the Electronic Data Remission System in the field of Social Security (RED System) or through the electronic means available at the electronic headquarters of the Secretary of State for Social Security (Sedess) through this form.
“Once established the requirements and conditions that must be met to access the moratorium on payment by Order of the Minister of Inclusion, Social Security and Migration, a new service will be implemented” for the presentation of the application, the website of Social Security.
Said Order was published in the Official State Gazette on April 28 and establishes that companies and self-employed workers can benefit from the moratorium “whose economic activity, among those that are not suspended due to the state of alarm” is in one of these fields: manufacture of metalwork, plumbing, installation of heating and air conditioning systems, installation of woodwork, retail trade in non-specialized establishments, with a predominance of food products, beverages and tobacco, other retail trade in establishments non-specialized, retail trade of bread and bakery products, confectionery and pastry in specialized establishments, advertising agencies, dental activities, hairdressing and other beauty treatments, other perennial and non-perennial crops (codes 129 and 119, respectively, of the National Classification of Economic Activities).
Due to the moratorium, the quotas corresponding to May, June and July of this year must be entered in the months of November 2020, December 2020 and January 2021, respectively, and simultaneously with the quotas of those same months.
As for the postponement, the requirements to take advantage of it are to be up to date with the payment of Social Security obligations and not to have a current postponement for debts corresponding to periods prior to the month of March. Applications are submitted through the same channels as the moratorium. “When the self-employed worker is at the same time the owner of a company, and wishes to extend the deferral to the quotas corresponding to the workers employed by the company, said circumstance must be stated in the same application”, is detailed on the website of the Social Security Treasury.
Cessation of activity
All the self-employed who have had to stop their activity due to the declaration of the alarm state on March 14 or those who have suffered a decrease of at least 75% of their income in the month prior to the one requested, compared to the average billing from the previous semester, you can ask an extraordinary benefit for cessation of activity (also called self-employed unemployed).
To access it, the worker must be registered with Social Security and the Treasury and up-to-date in the payment of fees. If on the date you have closed the activity or reduced your billing, you do not meet this requirement, however, you will be invited to pay your debts. The request is submitted to the mutual collaborators of the Social Security.
In a normal situation, the benefit for cessation of activity could be collected only after having paid contributions for a minimum period of 12 continuous months and immediately prior to cessation. However, due to the exceptional situation, the Government has suspended this requirement. The period in which the aid is received will be understood as a contribution to Social Security and will not count for the benefits that may be received in the future.
The benefit is equivalent to 70% of the regulatory base. If the minimum contribution period of 12 months cannot be credited, it will be 70% of the minimum base. Being fixed at 944.40 euros for 2020, it would be 661 euros.
Self-employed workers who have ceased their activity due to the coravirus crisis (as well as employed persons who have an ERTE) and who are participants in a pension plan, they can rescue it for an amount equal to the amount you are ceasing to receive as a result of the alarm state. The limit is set at 1,613 euros per month, for the duration of the cessation of activity. The self-employed will calculate the income that they have stopped receiving for a maximum period equal to that of the validity of the alarm state plus one month, and they will justify it by contributing the income tax of the previous year and the self-assessments of the VAT of the last quarter.
They can request the ransom until September 14 and the entities will have a week to pay it to their clients. If, due to the state of alarm, he cannot deliver all the required documentation, the user can present a responsible declaration. In this case, however, you agree to present all the papers within a maximum period of one month after the end of the alarm state.
Self-employed in tourism
Within the credits instituted by the Government and endorsed by the Official Credit Institute (ICO) with the aim of alleviating the economic crisis derived from the pandemic, the self-employed in tourism have additional aid to the items already destined in this sector for of the Thomas Cook crisis. This line increases by 200 million euros the amounts initially planned (another 200 million), to support entrepreneurs in this sector who are now affected by the coronavirus, according to the ICO website.
The recipients of these grants must not be registered in any delinquency register and may not use the credit to refinance others that they have already contracted or that they want to have in the future. Each self-employed person can receive a maximum of 500,000 euros through a loan with accredited entities (BBVA, Santander and Cajamar), to be repaid in four years plus one grace period, at a fixed rate whose maximum limit is 1.5%.
Since April 6, the line of guarantees of the Ministry of Economic Affairs that the ICO manages for guarantee the loans granted to the self-employed, SMEs and companies since last March 18.
The line of guarantees was approved with an endowment of up to 100,000 million euros. The first tranche activated has an amount of 20,000 million euros, of which 50% is reserved to guarantee loans to self-employed workers and SMEs destined to pay wages, invoices, working capital needs or other liquidity needs, including those derived from maturities financial or tax obligations. The guarantees granted by the ICO will cover 80% of the principal amount of the loan unpaid by the customer, excluding other items, such as ordinary or late interest. Unifications and restructuring of loans are excluded, as well as the cancellation or early amortization of pre-existing debts.
Financial institutions must keep their customers’ working capital lines open until September 30. In addition, they may not condition the approval of the loans to the contracting by the client of any other service or product, as reported by the Ministry of Economic Affairs.
Moratorium of mortgages for commercial premises
The self-employed worker who is the owner of the property that he or she dedicates to the exercise of his economic activity and who is paying it through a mortgage loan, can take advantage of the mortgage moratorium established by the Government. The deadline to submit the application expires on May 11.
By virtue of this moratorium, the payment of the mortgage payment (principal and interest) can be suspended for three months, although this period may be extended by agreement of the Council of Ministers. The requirements are the same as those required in the case of the moratorium on the home mortgage.
Moratorium on rental of commercial premises
SMEs and the self-employed who have a rented business premises owned by public companies or large homeowners they can stop paying it up to four months later the end of the alarm state. The rent is deferred, from April 22, to the next monthly payment of each contract (in many cases, the one that would be paid on May 1. To return the money owed, SMEs and the self-employed will have a period of two years from the end the state of alarm or the extension granted in each case The amount will be replaced with installment payments without accruals or interest.
In the event that the lessor is not a large holder or a public company, SMEs and the self-employed may request the temporary and extraordinary deferment of the rent within a month, provided that both parties have not previously agreed in a formal manner. voluntary. Lessor and lessee may have the deposit for the total or partial payment of the monthly payments, but this must be replaced within a year and, in all cases, before the end of the contract.
In order to qualify for the moratorium, beneficiaries must meet a series of requirements. In the case of the self-employed, they must be registered as of March 14 – when the state of alarm was declared – and have suffered the suspension of their activity as a result of this exceptional period, or else a decrease of 75% in your billing for the month prior to which the deferment is requested with respect to the average for the corresponding quarter of the previous year.
Likewise, all rental contracts that end during the state of alarm are considered extended and microcredits are implemented for the rental of housing to which the self-employed who have seen their earnings reduced or have ceased their activity can apply. These credits have no interest and can be repaid within 6 to 10 years.
Go from modules to direct estimation
Self-employed workers can pay income tax through the objective estimation method (also called modules) or direct estimation. In the first, some indices determine the fee to be paid, which will always be the same regardless of the benefits made, while in the second it will be paid according to actual income and expenses.
Since April 23, the obligation to stay three years in the direct estimation method has been eliminated if the objective estimation method was renounced. In this way, the self-employed worker will be able to determine his net return according to the direct estimation method in 2020 and more accurately reflect the reduction in income he suffers as a result of the coronavirus crisis, but, if he wishes, he can choose the method of modules in exercise 2021.
The Autonomous Communities also mobilize and make available to self-employed workers a battery of aid articulated in different ways throughout the Spanish geography. Just to make three examples, in Andalusia the Administration makes available to each self-employed 300 euros, which must be requested within 15 days after the end of the state of alarm or until the budget allocation is exhausted (50 million euros ). Self-employed workers who have not opted for the aid for cessation of activity, or who are among the essential services and have seen their turnover have decreased, and whose turnover does not exceed 39,000 euros per year, can benefit from it.
May 5 is the deadline to submit the aid application in Catalonia and receive up to 2,000 euros. The self-employed worker must prove the reduction in income and a taxable base in his latest income statement that does not exceed 25,000 euros, in the case of individual taxation.
The Community of Madrid, through the Continuous Plan, pays the Social Security fee for March and April, as long as the income has fallen by at least 30%, and the application is submitted within the deadline of 17 of May. Another aid program, the Impulsa, initially endowed with five million euros, ran out in three days, but it is expected that it can be resumed with new provisions in the coming days.