Becoming a freelancer in Spain for 2024: a step-by-step guide

✓ verified by Elena Garro Accounting and Tax Specialist

If you’re an expat planning on becoming a freelancer in Spain, you might be a bit taken aback at the classic reaction of Spanish natives. Expect to hear snarky comments like “You’re actually going to pay to work?”, or “So instead of looking up the definition of Kafkaesque, you decided to get first-hand experience?” 

Well, at Xolo, we’re here to dispel those myths. Nobody is saying freelance life is an easy ride — far from it. But you never get the best things in life for free. And if you’re intent on taking the plunge and working for yourself, we’re not just here for it, we want to be the Sam to your Frodo. 

In this article, we’re going to: 

• Explain how to register as an autónomo (Spanish for freelancer 😉)
• Demystify how much you’ll pay in social security contributions
• Prepare you for the unexpected in the freelance world

So once you’ve kindly told those naysayers where to go, let’s get started.

The following list of contents may seem daunting at first, but take it as a good sign that we’ve done our homework on this. Rome wasn’t built in a day, and your journey to becoming self-employed certainly won’t happen overnight…Well actually, the registering part will, but more on that later. 

We’d recommend reading this article in its entirety today, and you can always come back to it for a refresher for individual steps. 

How to become a first-time freelancer in Spain

Great news, there are only two major steps to take to become a freelancer in Spain: 

• Register with the social security department system (TGSS)

• Register with the tax authorities (Agencia Tributaria)

Just make sure to do both processes within 60 days of each other. 

Registering as a freelancer with social security

When you’re planning your journey to self-employment (maybe even going on to self-fulfillment, who knows?), the first stop is at a social security office. You’re highly unlikely to just rock up and get going, so you can make your own alta in Social Security here or just let us do it for you. You’re technically registering for the Special Regime for Self-employed Workers (RETA), if anyone asks.

To find your way there, type the department’s Spanish name (Tesorería General de la Seguridad Social) into Google Maps and work from there. Bear in mind that getting an appointment is only possible if you have already a social security number.

If you’re new to Spain, you’ll have to get used to taking a range of personal documents to every admin meeting like this, so gather them all together in a nice little folder and keep them safe.

To register as a freelancer with social security in Spain, you’ll need:

• Your NIE (foreign identity card) or passport, accompanied by your work permit if you’re a non-EU foreigner)
• A completed TA0521 form — this is your application
• A document confirming your registration with the tax authorities, although you can submit this later

Next stop: The nearest tax agency office — the Agencía Tributaria📍.

Registering as a freelancer with the tax authorities

Once we’re registered with social security, it’s time to let the tax man know. First, get your appointment and fill out form 036 or 037. In short, the 037 form is a simplified version of the 036. It is simpler, has fewer pages, and less complications. 

But. In the Spanish bureaucratic maze, there’s always a but. Although it is more complex, you need to complete the 036 form if:

• You’re registering as a freelancer through a representative (like…ahem… Xolo 😇)
• Your fiscal and home addresses are different
• You qualify for a special VAT status
• You work with clients in other countries of the EU. For this, you’ll need an international VAT number that you can only get through the 036 form.
• You want to launch a company

Whichever form you use in the end, you'll be registered with the Agencia Tributaria as well as the Economic Activities Tax (IAE). Unless you’re very lucky, you’ll never have to pay the IAE. The minimum net amount to qualify is €1 million. If you’re really dealing with a seven-figure salary, good for you *slow clap* 👏.

In line with the new freelance quotas that are linked to actual income, this is also the time to communicate your forecast income for the coming fiscal year.

Registering as a freelancer online

We don’t want to make you feel old, but we’re almost a quarter of the way into the 21st century 😨. At this point in proceedings, you should expect things like registering as self-employed to be easily accessible online. Some said it would never happen, but we’re delighted to say you can now register as a freelancer with both the tax authorities and the social security service online.

Let’s not get ahead of ourselves, it’s hardly an easy process. But as a rule, expat freelancers need to manage their expectations when it comes to bureaucracy. If you think you’re going to get a straightforward process, you’re only setting yourself up for disappointment. 

Here’s how it goes. First, go to the online home of social security and the tax agency. They are both a bit of a minefield, to be honest, but you can technically get registered as a freelancer online.

But here's a tip. If you really want to simplify your registration as a freelancer in Spain, there’s an easy option: the Xolo option.

Registering as a freelancer with Xolo

Sorry if this sounds a bit presumptuous, but we honestly think we’ve got the perfect solution for you to register as a freelancer. At no extra cost on your monthly subscription, Xolo registers you as a freelancer in just 24 hours. We just need your NIE and passport in case your NIE is the white one (not the card) and 10 minutes of your time. 

Forget about your 036 and 037 forms, special VAT conditions, and the torment of government websites — leave it to us.

Need a bit more information? Keep reading, because here comes some good news. Or, at least, not-so-bad-news.

How much does it cost to become a freelancer in Spain in 2023?

Here's the good news: despite the reformed self-employment regulations that came into force in 2023 (more on that later), registering as a freelancer in Spain still costs nothing — nada 💃. Savor this moment, because on your journey to becoming a solvent autónomo, it’s one of the few moments where it doesn’t feel like you’re leaking money.

But once you’re registered as a freelancer, the real journey begins. Aside from your income tax, each month will end with a nice surprise — the freelancer quota. No idea what that is? Lucky you, we’re just about to explain.

Freelance quota in Spain

Don’t fall asleep! Freelance quotas might not be the most thrilling heading, but it’s much better to know where you stand. 

Firstly to bust an entry-level myth: The freelance quota is not a charge simply for being self-employed. Basically, it’s a monthly social security contribution that gives solos certain benefits. 

These benefits can be divided into four types.

What is covered by the freelancer quota?

• Coverage against non-work-related issues: health problems or anything that stops you from going about your business, but didn’t come about because of work. 
• Coverage against work-related accidents or illnesses: the exact opposite of the above. Any physical or health problem related to work. A quick example — spraining an ankle transporting boxes with your moving company.
• Coverage against contract termination of activity: there’s not much to explain here. If you lose work as a freelancer, your contributions let you apply for unemployment benefits.
• Retirement: someday in the future (and not a day too soon for many) the time will come to collect your pension for all those years of hard work 👴👵. Well, that wouldn’t be possible without your freelance quota.

How much is the freelance quota in 2023?

Spanish solos are entering a new era. Yes, 2023 was year one of a time when social security contributions vary by real income. If you’re new to freelancing in Spain, this might be quite underwhelming news, but decoupling from the previous flat fee really was a tectonic shift. Not quite on par with the 2021 volcanic eruption in the Canary Islands, but you get the idea. 

As of 1 January 2023, social security contributions for the self-employed have been calculated on the basis of certain levels of actual income. At the beginning of each fiscal year, every freelancer has to make an estimate of their income. Bear in mind you can change this every two months, so it’s not the end of the world if you aren’t sure. Based on that prediction, you’ll make a corresponding contribution. 

“Well that’s easy, I’ll just “predict” a really bad year and save tons of money!”

Believe it or not, they thought about that loophole. Once the fiscal year is over, Señor Social Security talks to Doña Tax Agency and checks your net income. If you’ve been underpaying, you’re going to have to settle that. 

The following table shows the contribution brackets for 2023 and the changes compared to last year:

These fees will be updated every year until 2025 at least. And while the flat rates from The Before Times™ have gone, there are two new elements to take into account:

• The reduced quota for new freelancers
• The zero quota

What do the zero quota and reduced quota mean for freelancers?

To wrap up the freelance quotas section, it’s worth mentioning these two nice benefits for low earners: reduced rates for new freelancers and zero quotas.

Firstly, the reduced quota is a flat rate of €86.66 in the case of 2024. This quota will increase each year because of MEI (a tax created in 2023 that suppose an increase each year). It can be extended for a second year if you don’t exceed the Spanish minimum wage (€1134) in that first year. What are the requirements? You only had to ask: 

• To not have been registered as a freelancer for the past two years, or, if you’ve already enjoyed the reduced rate, for the past three years
• To not be registered as a self-employed collaborator
• To have no debts with the tax agency or social security

There are in fact a multitude of other cases that give you access to the same discount and extension. Among them are: 

• Self-employed workers in a village of less than 5000 people
• Those registered in multiple activity 
• Males under 30, or females under 35 
• Victim of gender violence or terrorism
• People with a disability

Turning to the zero quota, this little gem is for freelancers in the regions of Madrid, Murcia, Andalusia, and the Balearic Islands. In the first three communities, the requirements for the zero quota are the same as those for the reduced quota, i.e. first year fixed if conditions are met, second year extension if you don’t exceed the minimum wage. However, in the Balearic Islands, it is only for female entrepreneurs and freelancers under 35, who were registered as a job applicant before their registration as autonomo.

So how much will a new freelancer save with the zero quota? A helpful €80 saving each eligible month.

Tax obligations for freelancers in Spain

Unfortunately, your outgoing payments aren’t limited to the freelance quota. It’s time to loop the Agencia Tributaria back in again for some fun tax talk. 

At the end of each fiscal year (or every quarter, depending on your circumstances), you’ll have to balance your Accounting books. But that’s not all, you’ve also got to take care of your income tax returns.

At first glance, it looks like a lot. It’s not just the paperwork on top of your real work, it’s the mad rush to deliver all your documents on time. But if we could be so bold, at Xolo, we can also give you a hand with your taxes.

Do I have to register as a freelancer if I’m on a low income?

With all the hustle and bustle of registering as a freelancer, and the tax and social security payments you’ll make along the way, you might be wondering if there’s a way around registering in the first place. Maybe in the country you’re coming from, low earners don’t have to register as a freelancer, and you’re wondering if it’s the same. 

Well the simple answer is that you do. Registering as a freelancer is mandatory for anyone regularly working for themselves for a profit. And be very careful, because "regularly" doesn’t mean dedicating 40 hours of blood, sweat, and tears per week. A single hour per week is enough to be considered regular.

What will happen if I don’t register as a freelancer

“How bad can it be?” “They’ll never actually catch me”. Two classic bravado-inspired quotations that can very easily precede a sticky situation. At Xolo, we strongly advise you not to try and evade the social security services or the Agencia Tributaria. 

For a start, the Tesorería General de la Seguridad Social (social security people 😉) will chase you up for all your outstanding payments, plus a 20% surcharge. And that’s if you’re lucky. 

Registering and deregistering as a freelancer in the same year

A much more sensible option for those without the luxury of a year-round job is to register as a freelancer on a monthly basis.

Thanks to a 2017 legal reform, self-employed workers can register and deregister up to three times in one year. Ideal for those in the tourism sector who make all their annual income in six months of sweltering heat, you can even leave on the 15th day of a month and only have to pay for those first 15 days. However, please note that if you deregister in your first year as an autónomo, you will lose your flat rate benefit upon re-registering.

It sure beats a court date with social security.

Extra considerations when registering as a freelancer in Spain

Beyond the initial registration with the tax agency and social security, and your monthly and annual payments, you might face a few other formalities when registering as a freelancer.

We want to prepare you with some of the most common ones. 

Registering with the town hall: opening and building licenses

Let's take an example: on a trip to Cinque Terre and Naples you fall in love with Neapolitan pizza 🍕 (which isn’t too difficult) and decide to set up your very own pizzeria in the neighborhood, following the traditional recipe, of course.

Great idea. Just register with social security and the tax authorities, fill out all your fun forms, set aside some money for your freelance quota, and you’re ready to get cooking!

Well, almost.

To open a premises as a workplace, you need a permit from the town hall. The same is true for any refurbishments on the premises.

Sure, there are exceptions. If you’re working from a private home or won’t open to the public, you’re all good. So no, designing websites from your bedroom ain’t gonna require a bunch of paperwork.

Registering with labor organizations

Continuing with our pizza shop example in the trendy, up-and-coming Sants neighborhood in Barcelona. Let’s say that you’ve hired an employee to stay open all night and take advantage of that late-night-munchie demographic. Hey, we’re not judging, people love soaking up summer beers with a slice of pizza. Wait, are we still in the analogy? Come on, Xolo, get your game face on.

Anyway, now you have more work on your plate: every employee you have must be registered with social security, and the workplace must be registered with your regional authorities. You’ve also got to have a Visitor's Book, whether physical or electronic. No, we’re not joking. But it’s for the inspectors from the labor and social security departments, not your party-going public.

The insurance question

Whether you’re opening a pizzeria or translating from Chinese to Esperanto, you’ve got to choose an insurance company.

Referred to as mutuas in Spanish, these insurance companies are private organizations that deal with medical assessments for sick leave caused at work. Therefore, the choice of the insurance company is a key issue. Find one that is easy to contact, one you trust the most, or the one that’s just around the corner. A lot of expat freelancers in Spain look for a mutua that offers services in their language. A doctor’s office isn’t usually the best place to practice your linguistic skills. 

You choose your preferred insurance company when you register as a freelancer with social security.

Is it worth becoming a freelancer in Spain?

Uff, time for a breather, right?

Even after a deep dive into the registration process and full transparency on the freelance quota, you might still be asking yourself "is it worth becoming a freelancer in Spain?"

Honestly, there’s not much left to say in this article, but we’d invite you to explore all of our blog posts, where you can clarify the journey a little more. Yes, there’ll be some terrifying (and maybe more confusing) parts to be found, but you’ll also see the almost irresistible benefits.

Come on, it’s living in Spain and being your own boss. Who wouldn’t want to do that?

If it’s just the hassle of the admin that’s putting you off, don’t sweat it. From becoming a freelancer to staying in control of your taxes and obligations, Xolo will guide you all the way, so you can focus on living the life and making some dough.