If you need updated information on the
deductible expenses in Personal Income Tax for the self-employed
that can be deducted in the Income Tax Return for this year, this article interests you. Below, you can see what kind of expenses you need to document to deduct them at your next appointment with the Treasury.
Likewise, you will be able to see an advance of the expenses that a self-employed person can deduct that will be deductible in the IRPF of 2018 after the entry into force of the new Law of Self-employed and that are fundamentally related to the diets and expenses of maintenance.
Guide to deductible expenses in Personal Income Tax for self-employed workers in 2018
Consumption and operating expenses
This section would include the amounts paid for the purchase of goods and raw and auxiliary materials. Also part of this group are fuel expenditure, packaging, as well as office supplies.
To determine the consumption of the year, it is necessary to add the initial stocks and the purchases made and, subsequently, subtract the stocks at the end of the year.
Wages and Salaries
It includes the payrolls of the workers as well as compensation, prizes or any other type of payment in kind.
Social security
It consists of the sum of Social Security contributions by both the self-employed and the workers.
Likewise, and since the tax reform of 2015, it is also possible to deduct 50% of the amounts contributed to social security mutual societies.
Staff costs
Expenditure on employee training and compensation for the termination of contracts fall into this group, as do premiums paid for accident insurance or contributions to a pension scheme or other social security scheme.
Rentals and fees
Rents or leases as well as fees, technical assistance services and fees for leasing operations on non-depreciable goods and assets are considered included in this type of deductible expense.
Maintenance of facilities
With the exception of the renovation and improvement works that are considered amortizable assets, maintenance costs as well as spare parts necessary for the normal operation of the facilities are included in this section.
Professional Management Services
The fees of the professionals necessary for the management of the company such as economists, lawyer or auditor of accountsare included. Fees paid to commercial mediators will also be included.
Other services
The list of deductible expenses that can be included here is extensive. From expenses for research and development (R&D),to those expenses related to the payment of insurance, bank commissions or advertising. The cost of water, electricity and telephone supply must also be included; or the health insurance premiums of the holder, spouse and children under 25 years of age who live with the holder, with a limit of € 500 of person with right.
Deductible taxes
It includes the payment of the IBI (Real Estate Tax), the Economic Activities Tax or
IAE,
as well as the payment of taxes or surcharges except for those applied for delays or delays in the payment of general taxes.
Financial expenses
The operations of the business activity of a self-employed person with the banks generate expenses that can be deducted.
The payment of interest for credit operations or loans, surcharges for deferrals of debt or payments to the Treasury or expenses for discount of effects are deductible from Personal Income Tax.
Amortizations
Depreciation or impairment of the company’s property, plant and equipment can be deducted as an expense. To determine the amount, it is necessary to resort to what is indicated in the Corporation Tax.
What’s new for fiscal year 2018
On October 11, the
Law of Urgent Reforms of the Self-Employed Worker
was approved, which includes two important novelties for the next fiscal year.
Domestic supply
Among the tax deductions for the self-employed who work from home,
the possibility of deducting up to 30% of the expenditure on water, electricity, telephone and internet stands out.
Supplies must be in your name and the percentage listed applies to the percentage of the household destined for the business.
Subsistence and maintenance
Finally, it should be noted that all expenses related to the vehicle are not usually accepted by the Treasury.
The Law establishes that expenses related to meals may be deducted provided that, in addition to being directly related to the exercise of economic activity, they occur in catering establishments and are paid using electronic payment.
We know the difficulty of including deductible expenses for the self-employed in front of the Administration, as well as reliably demonstrating and justifying in detail the activity carried out and its relationship with our work.
This makes many self-employed renounce to deduct the amounts paid in these concepts or, in case of presenting them, that the Treasury dismisses them.
