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Establish and develop translation and language business in Spain
Thread poster: Ann Krol
Ann Krol  Identity Verified
Spain
Local time: 00:31
Member (2008)
English to Polish
+ ...
Mar 8, 2009

Dear All!

I'm looking for some information about establishing translation business in Spain. I consider to move to Spain for long-term residence this year and continue my translation activity in Spain. But I'm not sure what will be better for me in regard to tax conditions for freelance translators and business on the freelance basis in Spain. I'm thinking about:

1. Continue work as a freelance translator based in Spain
OR
2. Establish translation business first on the freelance basis

At the moment I have a contract with a Spanish agency and some offers for large projects from Spanish clients, but actually I'm not going to work for any agency as a "office translator". I would prefer to register my freelance business, so I will be glad to hear some suggestions from foreign citizens-trasnlators and linguists based in Spain they did it and have experience.

Thank you in advance!
I wish you all best!

Atentamente,
Ann


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Attila Piróth  Identity Verified
France
Local time: 01:31
Member
English to Hungarian
+ ...
Moving topic... Mar 8, 2009

... to Business issues, and making it on-topic.
Attila


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Ann Krol  Identity Verified
Spain
Local time: 00:31
Member (2008)
English to Polish
+ ...
TOPIC STARTER
Thanks Mar 8, 2009

Thanks Atilla!

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xxxLia Fail  Identity Verified
Spain
Local time: 01:31
Spanish to English
+ ...
some simple guidelines Mar 8, 2009

AnKrol wrote:

Dear All!

I'm looking for some information about establishing translation business in Spain. I consider to move to Spain for long-term residence this year and continue my translation activity in Spain. But I'm not sure what will be better for me in regard to tax conditions for freelance translators and business on the freelance basis in Spain. I'm thinking about:

1. Continue work as a freelance translator based in Spain
OR
2. Establish translation business first on the freelance basis

At the moment I have a contract with a Spanish agency and some offers for large projects from Spanish clients, but actually I'm not going to work for any agency as a "office translator". I would prefer to register my freelance business, so I will be glad to hear some suggestions from foreign citizens-trasnlators and linguists based in Spain they did it and have experience.

Thank you in advance!
I wish you all best!

Atentamente,
Ann


You can work as a freelancer if you follow some procedures. Establishing a business is another matter (and depends on whether you want to be just a business of one or more).

To work as a freelancer you will need to apply for a tax number (NIF).

Spain is quite bureacratic, so probably the best thing to do would be to employ a "gestor" to do all the legwork. It's smart, though, to keep informed yourself too, though, as in my experience in Spain, "you have to ask the right questions"!

I pay about 70 euros a month for the gestor to deal with the tax authorities. I keep my own records (bill, expenses, etc). To do an "alta" (register for the first time) would be an additional cost, but not very expensive.

A major outgoing would be the 250 euros you are obliged to pay monthly to the social security. You pay that even if you earn nothing.

You will pay tax at (my own experience) around 20%. On each bill issued to clients in Spain you have to deduct 15% automatically. By June each year you have to declare your income, and readjustments are made (you get tax repaid or you pay more, depending on your earnings and allowable deductions).

Finally, and still keeping it simple, freelancers are not well provided for if they are unemployed or off sick. Pensions for freelancers are also not good. These are all things you need to build into the decision.


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Ann Krol  Identity Verified
Spain
Local time: 00:31
Member (2008)
English to Polish
+ ...
TOPIC STARTER
Thank you! Mar 8, 2009

Dear Lia,


Thank you for your guidelines!
Special for the tips about a reliable gestor.


So now I know how is it working in Spain as a freelance translator.
20% from the whole income yearly is pretty big amount, or it's not from the whole amount?
From 3000euro/month - 7200euro taxes yearly


"Finally, and still keeping it simple, freelancers are not well provided for if they are unemployed or off sick. Pensions for freelancers are also not good. These are all things you need to build into the decision."
I think the pension for freelancer is depending on freelancer, I mean, in every case can be different, but generally I know that the rates in Spain are lower, but living in Spain doesn't mean working only for Spanish clients.


I will be happy to know how is it with the taxes by establishing own business, first, for example, one-human-company. Sometimes the conditions are better and working just as a freelancer it pays only till certain income, because by earning more the taxes conditions are very unfavorably.


Thank you in advance for your all suggestions!
Have a lovely day!

Ann


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Tomás Cano Binder, CT  Identity Verified
Spain
Local time: 01:31
Member (2005)
English to Spanish
+ ...
Probably more Mar 8, 2009

AnKrol wrote:
20% from the whole income yearly is pretty big amount, or it's not from the whole amount?
From 3000euro/month - 7200euro taxes yearly


Do you think that is too much? If you make an average of 36.000 euros p.a., that 20% looks pretty short to me, honestly. You might want to pay a Spanish "gestor" to make a quick calculation of how much you would pay.


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Ann Krol  Identity Verified
Spain
Local time: 00:31
Member (2008)
English to Polish
+ ...
TOPIC STARTER
compared with what freelance tranators pay in Poland Mar 8, 2009

Dear Tomas,

In Poland - in the country, where I'm living now, as a freelance translator I pay 20% from the 50% of the whole income yearly.
that means 50% from 36.000 euros = 18.000 euros and 20% from 18000 euros = 3600 EUROS


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Tomás Cano Binder, CT  Identity Verified
Spain
Local time: 01:31
Member (2005)
English to Spanish
+ ...
Why do you want to establish your business in Spain? Mar 8, 2009

AnKrol wrote:
In Poland - in the country, where I'm living now, as a freelance translator I pay 20% from the 50% of the whole income yearly.
that means 50% from 36.000 euros = 18.000 euros and 20% from 18000 euros = 3600 EUROS


Then I would honestly advice you to live wherever you like, but keep registered in Poland and invoicing as a Polish citizen. I assume you pay Social Security in Poland and that the Spanish health services would be available to you under an agreement between Polish and Spanish Social Security organisations.

And as you say, in Spain you have to pay taxes for ALL the money you make if you make more than 22.000 euros (that was last year; they change it every year).

May I ask you how much do you pay to Social Security as a freelancer in Poland (over here Eur 240 is the minimum monthly payment for a freelancer).


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Steven Capsuto  Identity Verified
United States
Local time: 19:31
Spanish to English
+ ...
Spanish tax residency Mar 8, 2009

Tomás Cano Binder, CT wrote:
Then I would honestly advice you to live wherever you like, but keep registered in Poland and invoicing as a Polish citizen. I assume you pay Social Security in Poland and that the Spanish health services would be available to you under an agreement between Polish and Spanish Social Security organisations.


The last time I looked into this, I was told that the Spanish government considers people residents for tax purposes if they are present in Spain more than 183 days in the same calendar year, regardless of whether their business is legally based in another country.

This was a few years ago and the law may have changed (assuming the information I got was correct in the first place).

[Edited at 2009-03-08 16:32 GMT]


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Tomás Cano Binder, CT  Identity Verified
Spain
Local time: 01:31
Member (2005)
English to Spanish
+ ...
But I won't tell them! Mar 8, 2009

Steven Capsuto wrote:
The last time I looked into this, I was told that the Spanish government considers people residents for tax purposes if they are present in Spain more than 183 days in the same calendar year, regardless of whether their business is legally based in another country.


Yes, that might be the case Steven, but I won't be the one to tell the that Ann is here!


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Ann Krol  Identity Verified
Spain
Local time: 00:31
Member (2008)
English to Polish
+ ...
TOPIC STARTER
...smile... Mar 8, 2009

Steven,

Long time ago I found some info in the legal newspaper about how is it when somebody works in 2 countries within the EU. For example as a citizen of the country X is doinig business, translating etc. in the country Y and staying more than 183 days in each country. In accordance with the double tax treaty between the countries, we can choose, where we would like to declare our income, if it's not very clear which country is a centre of our business and private live.

Thanks Tomas for your confidentiality...smile...
It's really small amount in Poland for the Social Security, but I prefer private social services.

Why I'm thinking about establishing my translation business in Spain?
2 months ago my family sold a flat, since several years I dreamed about living and working abroad in a sunny country, and now somehow, I think this is a good time to do it. If moving for long-term residence I have to take my business with me...smile...

We also have in Poland the magic limit - like you 22.000 EURO, and I'm wondering because after registration - establishing the own business - the limit is gone and the tax conditions are better. So I hope you have a similar system in Spain, and maybe the solution willl be better for me.

Hmm, I hope, somebody, who knows it, will share your knowledge here soon
Thanks in advance!

With best wishes!
Ann


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Daniel García
English to Spanish
+ ...
Get legal advice Mar 8, 2009

Have a look at the "Services directive":

http://ec.europa.eu/internal_market/services/services-dir/index_en.htm

I don't know if it applies to your case but it could cover you provide services in Spain and still stay under Polish law for taxes and social security.

Daniel


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xxxLia Fail  Identity Verified
Spain
Local time: 01:31
Spanish to English
+ ...
? Mar 9, 2009

AnKrol wrote:

I think the pension for freelancer is depending on freelancer, I mean, in every case can be different, but generally I know that the rates in Spain are lower, but living in Spain doesn't mean working only for Spanish clients.




I don't see the connection. Living in Spain obviously doesn't mean working only for Spanish clients. But living legally in Spain affects your entitlement to a Spanish pension. It's you - not your clients - who makes a provision for your pension. In Spain, paying 240-250 a month (the minimum) entitles you to a minimum pension (at present around 600 euros, I believe).


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