July 9, 2020

Treasury will maintain the current module system for another year

The self-employed will be able to continue invoicing and taxing with the current conditions. The interim government has forced the postponement of the reform

It is already official. The Ministry of Finance has decided to extend the current conditions of access of the self-employed to the module system, the objective estimation method of the Personal Income Tax and the VAT -the fifth consecutive time that it does-. The interim government's functions have once again delayed the reform of the system, and the Treasury, to avoid problems of execution until a new government is clear about what the system will be when it is reformed, has had to go back and freeze all taxation parameters of the Objective Estimation Regime, so billing will be maintained with the current fiscal criteria.

The draft that was being negotiated with the sector proposed a new reform of the current limits of the module regime, which must be approved by decree, in accordance with the provisions of the Tax Reform Law, which provided that as of this year the workers for own account with full returns of more than 150,000 euros that will bill other professionals more than 75,000 euros or whose purchases exceed 150,000 euros would stop paying for modules. But to prevent possible fiscal chaos and prevent the entire sector from rising against a measure taken unilaterally, the Government has decided to maintain the limits in its current terms. In this way, the self-employed with full returns of up to 250,000 euros, who bill other professionals up to 125,000 euros or whose purchases do not exceed 250,000 euros can continue to bill as before.

The Ministry published this extension today in the BOE due to deadlines, since if it had not been officially published, on January 1, the IRPF reform approved in 2016, which has already been paralyzed five times, will enter into force. According to this regulatory change, the tax limits should be tightened by the objective estimation system (modules), so that the tax billing limit would fall from the aforementioned 250,000 to 150,000 euros and, in the case of billing to other companies , from 125,000 euros to 75,000 euros. This measure would directly affect more than 250,000 freelancers, who would have a hard time keeping their taxation through this regime.

. (tagsToTranslate) Treasury (t) Tax Agency

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