Registering as self-employed (autónomo) in Mallorca: a guide for EU citizens

What is an autónomo?

The trabajador autónomo is a self-employed sole trader or freelancer, registered with the tax office and with social security under the special scheme for the self-employed (RETA), personally liable for business debts.

Requirements for EU citizens

As an EU citizen you can be self-employed in Spain without a work permit. You need a NIE, ideally the residence registration if you stay more than three months, a Spanish bank account and any licences your activity requires, such as an opening licence for premises. Non-EU citizens need a residence permit that allows self-employment; see immigration.

Registration step by step

1. Tax office: register with form 036 or 037, stating the activity code (IAE) and VAT regime.
2. Social security: register in RETA, at the latest when the activity starts.
3. Town hall: activity licence if you open premises.
4. Other registers, depending on the sector.

Social security contributions

Since 2023, monthly contributions depend on expected net income, in brackets. New autónomos can pay a reduced flat rate (tarifa plana) of €80 a month for the first twelve months, subject to conditions, extendable for low incomes. Contributions cover healthcare, pension and other benefits.

Taxes

• Income tax (IRPF): progressive, on profit, with quarterly payments on account (Form 130) unless clients withhold tax.
• VAT (IVA): quarterly returns (Form 303) and an annual summary.
• Bookkeeping: invoice records and receipts.

Most autónomos work with a gestor, as the deadlines are strict.

Autónomo or limited company (SL)?

Above a certain profit or with liability risks, an SL may be better: limited liability and corporate tax instead of progressive income tax, at higher set-up and running costs. A comparison of both before incorporating is worthwhile. See setting up a company in Spain.

Common mistakes

• Starting work before registering.
• Not applying for the flat rate.
• Missing licences for holiday rentals or restaurants.
• Invoices without the required details.
• Double social security charges because of an unclear situation between two countries.

An example

A graphic designer moves to Palma and keeps working for agencies in Germany and some Spanish clients. She registers at the town hall, obtains her residence certificate and registers as autónomo. In the first year she pays the €80 flat rate. She invoices EU businesses without Spanish VAT under reverse charge and Spanish clients with 21% VAT, and files her quarterly returns. She deregisters at home to avoid dual residence.

Castell.law is the English and German-speaking practice of Castell Abogados, a law firm in Palma de Mallorca. This page is general information, not advice on a specific case: laws and procedures change, so check your situation with us before acting.