When we start an activity on our own, one of the first questions we ask
is when we have to register as a freelancer and whether or not we have an obligation to do so.
This question, which seems simple, is complicated when we read the current legislation, because there is cited an ambiguous concept such as the habituality of economic activity; that is, if the activity you carry out as an employee is carried out regularly or sporadically.
Given these assumptions yes or yes you have to register as a freelancer
What happens if you open a physical store?
This is one of the clearest cases that allow to explain the concept of habituality of the activity.
Even if you do not obtain income from this activity or these are minimal, it is clear that you intend to make sales on a regular basis and that these generate economic income.
Therefore, here it is clear when it is mandatory to register as a freelancer:the moment you open the door of the store.
What if I only have my business open 3 months a year?
There are businesses that are seasonal, such as an ice cream shop in a tourist place. This type of business is only compensated to be open a few months each year.
In this case, when do you have to register in the self-employed? Under this assumption, it would be valid to be registered only a few months a year,in which activity is actually carried out in a totally legal and justified way.
However, this possibility opens a wide range of options to defraud the Treasury by pretending to have an occasional activity when it is not.
A clear example is that of those entrepreneurs who accumulate invoices to present them for one month per quarter, being registered in the self-employed regime.
This practice is clearly fraudulent and you would risk a fine that would force you to pay the unpaid self-employed fees with a surcharge of 20% plus the payment of interest.
If I have a website, at what point should I register as a freelancer?
In online business, demonstrating habituality is somewhat more complicated. On the one hand, there is the interpretation that it is a business open 24 hoursa day and 7 days a week, so there is no better definition for a usual activity.
However, on many occasions, the nuance comes when we qualify the activity as lucrative because the income is minimal and does not reach the minimum wage,which is why in principle it would not be necessary for you to register as self-employed, saving you the Social Security quota.
At this point, it is important to point out that there is no legislation that supports the theory that, if your income does not exceed the annual minimum wage, it is not mandatory to register as self-employed. However, there is case-law in this regard which supports this thesis.
Each case should be studied carefully because there are many business models on the Internet.
These range from online stores that receive their income from the sales of physical products to websites that are dedicated to creating content to include advertising and charge for it. Others, on the other hand, take a commission for recommending the purchase of third-party products.
In each case, the activity can be understood as habitual in a different way.
I want to issue invoices without being autonomous. Can I do it risk-free?
Together, an important question arises: if you carry out an economic activity for which you charge an amount to a third party, you will have to issue an invoice with its corresponding income tax deduction. But, then, do you have to register as a freelancer?
Here the answer is clearer. When you want to issue invoices, it is not mandatory to register as a freelancer, but you do haveto do it in the Treasury, within the Economic Activities Tax
corresponding to your activity.
This procedure is completely free. With it you inform the Treasury that you are carrying out an activity, you explain its typology and, yes, you will have to submit a quarterly VAT and Personal Income Tax return.
It is convenient that you inform yourself about whether the nature of your activity is necessary to present invoices because there are exceptions,such as training or cultural, in which income is considered work activities and economic activities.
How long does it take to register as self-employed?
Sometimes, what makes us postpone the decision to register as self-employed and risk a fine is the ignorance of how long it takes to register as self-employed.
Currently, thanks to the digital certificate, the procedures are very simple and fast, so we can register in 24 hours,something unthinkable just a few years ago.
In addition, the digital certificate facilitates future procedures with the Treasury and Social Security, related to the activity of self-employed.
In short, although the current Spanish legislation is not clear, to know when to register as a self-employed person it is necessary to know the activity that is carried out.
Likewise, it is necessary to identify this activity as habitual or argue that it is only a sporadic work to which hardly any time is dedicated throughout the year.
If you have any questions, if you want to clarify your situation and know with certainty when it would be mandatory to register as a freelancer, contact our
AYCE Laborytax advisors
and we will clear all your doubts.