If fulfilled, many freelancers may forget to invoice and declare VAT before the Treasury. More than anything, because the Spanish Tax Agency is studying to carry out a change that will affect all those self-employed workers who bill less than 85,000 euros per year. A measure that could mark a before and after in our country.
In this case, we are facing the elimination of VAT for the self-employed who have a turnover of less than the amount that we have just mentioned. This has been advanced by the director of the Department of Tax Management of the Tax Agency. We would be facing a new regime with which a large part of the self-employed in our country will benefit.
Without VAT below 85,000 euros per year
Although not much more is known yet, especially if it will finally be approved. Both the Treasury and self-employed organizations are studying to carry out this tax change that, at least, will affect more than one million taxpayers in our country. Basically, because VAT would be eliminated for those workers who bill less than 85,000 euros a year (100,000 euros if there are intra-community operations). And not only this, but, in this possible new regime, there is also talk of ending the regime of personal income tax modules.
In this way, those self-employed workers who do not reach that amount each year, will be able to take advantage of the next VAT franchise regime that will exempt workers from the obligation that exists right now, to include VAT on the invoices issued and, not only this, but they could also forget about having to present the quarterly declarations of this Value Added Tax, which are currently carried out.
This possible change of regime already had a consensus within the different representatives of the Ministry of Finance, in addition to the organizations CEOE, Cepyme, CCOO, ATA, UATAE and UPTA, which, since the end of August last year, were already participating in a working group created within the Institute of Fiscal Studies (IAE).
Therefore, it is estimated that approximately more than one million self-employed workers in Spain would benefit from this possible change. However, even if the requirement is removed, it would still be optional. Everything will depend on the type of business that each worker has, since, depending on this, they will be able to take advantage of the VAT invoice and declare this tax.
When would it go into effect?
If this new tax regime for self-employed workers is finally approved, it could be applied as of 2024 or 2025. For example, some representatives believe that, if this change is allowed to be promoted, as of April of this year , the new VAT exemption regime could already be applied in 2024.
However, from the Treasury they do not give deadlines. In addition, from this ministry they remember that the community directive already has this VAT regime, since it exists in all the countries of the European Union, except in Spain. However, it would not enter into force until 2025. Therefore, the group of representatives that we mentioned above is working so that this change can be applied sooner and, above all, to see how and to whom it can be applied.
