Next January 1 will mean a radical change in the self-employed contribution system. The free choice of contribution is over regardless of income, an anomaly that has led to 84% doing so for the minimum base. As of that day and in a gradual process, the self-employed will contribute based on their net income on a scale of 15 tranches that will go from 230 to 500 euros in 2023. In the following two years, the minimum will drop to 200 and the maximum will rise to 590 euros.
A transformation that will take place after this Thursday the Congress of Deputies has validated the decree law that reforms the Special Regime for Self-Employed Workers (RETA).
“It is a turning point – said the Minister of Inclusion and Social Security, José Luis Escrivá in Congress – it is a collective success that we have found a way to correct a situation that affects more than three million workers, one in every six in our country, which have so far received a different treatment”. For Escrivá, the new system is “more fair, flexible and equitable.”
The truth is that the reform came to Congress endorsed by the social partners. After a long and agitated negotiation, Minister Escrivá managed to add both the unions and the employers. UPTA and UATAE are convinced by the reduction in the fee for the self-employed with the least income, and the ATA employers managed to limit the increase for those with the most income. Escrivá’s initial proposal was more radical and lasted until 2031. Now, there will be a renegotiation in 2025.
In the end, as things stand, three out of four self-employed workers will contribute the same or less than they currently do, and one out of two will pay less. It is the result of this distribution that lowers the fee for those with incomes of less than 1,300 euros, keeps it the same for those who earn between 1,300 and 1,700 euros, and increases it for those who earn more than 1,700. It is staggered in 15 sections that the worker must choose based on his income. You can modify the chosen section up to six times per year, and at the end, the Tax Agency will compare the declaration with the actual income, to proceed with a refund or claim for a supplementary contribution.
On the other hand, in their first year of activity, the self-employed will be able to opt for the reduced quota of 80 euros, which will be extended for a second year in the case of those with incomes below the SMI.
In addition, the new system expands the benefits for the self-employed, with the incorporation of sectorial and cyclical RED mechanisms, without the need to completely close the business to access aid.
The current system, with its generalization of the minimum contribution base and in many cases, permanence in it throughout the entire professional career, causes a lack of protection for the group. The comparison with the general regime is bloody. The average pension of the self-employed is 43% lower than that of the general scheme. They are more than 600 euros per month difference.
