The Social Security website has published a series of questions and answers about the new aid for self-employed workers, which we are informing you about because of your interest.
We would like to inform you that the following Questions and Answers regarding the new aid for self-employed workers have been published on the Social Security website, which we present below:
I am self-employed and a recipient of the extraordinary benefit, and I have resumed my activity. Am I still eligible for any assistance?
Yes. From July 1st, self-employed workers who were receiving the extraordinary benefit for cessation of activity will automatically benefit from an exemption in Social Security contributions for the months of July, August and September.
So, how much am I going to pay into Social Security these months?
In July, those receiving the extraordinary benefit for cessation of activity will not pay Social Security contributions because the exemption will be 100%. In August, they will pay half, as the exemption will reach 50% of the contribution, and in September, they will pay 25% less than the ordinary contribution.
Do I have to request this exemption or will it be done automatically?
It is not necessary to request the exemption, as it will be carried out ex officio by the General Treasury of Social Security in relation to all self-employed workers who stop receiving the extraordinary benefit for cessation of activity, maintain registration in the corresponding scheme and do not request the benefit for cessation of activity.
My business is up and running, but I'm still not making much money. Will I continue to receive benefits?
Self-employed workers who maintain their activity but see their turnover reduced in the third quarter by 75% compared to the same period in 2019 (or whose net income is less than 1.75 times the SMI) may apply for the ordinary benefit for cessation of activity.
As a new measure, seasonal self-employed workers will be able to access the extraordinary benefit until September 30, provided that their income in 2020 is less than 1.75 times the minimum wage.
What does the standard benefit for cessation of activity consist of?
The benefit amounts to 70% of the regulatory base, which is approximately €660 for a self-employed worker contributing at the minimum rate. This is in addition to the portion of the contribution corresponding to common contingencies, meaning the total financial benefit can reach €930 per month.
Is the standard benefit compatible with maintaining the business activity?
Yes, it is compatible.
Will it be deducted from my unemployment benefits? Will it count as benefits used?
The ordinary benefit for cessation of activity compatible with work will count as a consumed right, so the consumed period will be deducted.
What requirements must I meet to apply for the standard benefit for cessation of activity?
You must be registered and actively contributing to the Special Regime for Self-Employed Workers or the Special Regime for Seafarers, as applicable, and be up to date with your Social Security payments. If you are not up to date with your Social Security payments, you have thirty calendar days to pay the corresponding contributions.
It is necessary to have contributed for cessation of activity for at least 12 months immediately prior continuously.
In addition, it is necessary to prove a reduction in turnover during the third quarter of 2020 of at least 75% in relation to the same period of 2019, as well as not having obtained during those same periods net income greater than €5,818.75 per quarter (1.75 times the SMI).
Do I have to wait until the end of the term to apply for the benefit?
Applications can be submitted from July 1, 2020, but will only have retroactive effect if submitted before July 15. Applications submitted after that date will have retroactive effect from the day following the application.
How do I prove the drop in revenue?
In principle, a self-declaration from the self-employed worker is sufficient to prove the drop in turnover.
However, from October 1, 2020 and February 1, 2021, the mutual insurance companies collaborating with the Social Security system, or the Social Institute of the Navy, as the case may be, will obtain from the Ministry of Finance the tax data for the 2019 and 2020 years necessary for the monitoring and control of the benefits recognized.
Only if the aforementioned entities cannot access the data held by the tax authorities, the workers must provide, within ten days of being requested:
- Copy of form 303 for self-assessment of Value Added Tax (VAT), corresponding to the declarations of the second and third quarter of the years 2019 and 2020.
- Copy of form 130 corresponding to the self-assessment in installment payment of Personal Income Tax (IRPF) for the second and third quarter of the years 2019 and 2020 in order to determine what corresponds to the third and fourth quarter of those years.
Self-employed workers who pay taxes under the Personal Income Tax (IRPF) by objective estimation (model 131) must provide the necessary documentation or any other means of proof that serves to prove the income required in this provision.
Until when will I be able to receive the benefit?
At most until September 30, 2020. After that date, it will only be possible to continue receiving it if all the requirements established by the General Social Security Law are met.
Do I have to keep paying the fee?
Social Security contributions must continue to be paid while receiving this benefit. However, self-employed workers receiving this benefit will also receive, in addition to the benefit amount, the corresponding contributions for common contingencies.
My business isn't doing well and I've decided to close. Am I entitled to unemployment benefits? For how long?
In the event of closure, the right to unemployment benefits compatible with any existing employment is maintained until the date on which the deregistration from the social security scheme takes effect. From that moment onwards, to receive ordinary unemployment benefits, the requirements established in Article 330 of the consolidated text of the General Social Security Law must be met.
Do I have to pay income tax on the extraordinary benefit? And on the cessation of activity benefit?
Yes, you have to pay income tax because neither of these two benefits is included in the list of income exempt from this tax.
I no longer meet the requirements and want to return the amounts I have received improperly. Where can I do this?
To waive the benefit, you must contact the mutual insurance company that recognized the right to it, or the Social Institute of the Navy if that managing entity recognized the right.
To return the amounts unduly received, you must also contact the mutual insurance company or, where applicable, the Social Institute of the Navy
If I am eligible for a flat rate or other discount, will the reduction be applied to the flat rate fees, or will I pay the standard fees with the planned reductions for these three months, and then the flat rate will apply from September onwards?
During these three months, the reduction in fees will be applied to the flat or reduced rate that corresponds to the worker in each case, without the reduction ever exceeding the fee to be paid.
Is the possibility of switching to receiving the standard benefit for cessation of activity applicable to self-employed business owners?
All self-employed business owners who have received the extraordinary benefit for cessation of activity up to June 30 and who meet the required conditions are entitled to receive this benefit.
How do we justify the drop in income of the partner requesting the benefit?
In any way permitted by law
How and when do I apply?
As with the extraordinary benefit, the application must be made to the mutual insurance company collaborating with the Social Security system that the self-employed worker has chosen.
The benefit will be effective from July 1st, provided the application is submitted before July 15th. If submitted later, the benefit will be effective from the day after submission.
What documentation do I need to provide?
The application form provided by each mutual insurance company. This form may authorize the company to consult the tax data for the 2019 and 2020 tax years necessary for monitoring and controlling the benefits granted.
If this data consultation is not authorized or the mutual insurance company cannot access it, the worker must provide a copy of form 303 for self-assessment of VAT for the second and third quarters of the years 2019 and 2020 and a copy of form 130 corresponding to the self-assessment in installment payment of IRPF for the same periods.
Self-employed workers who pay income tax (IRPF) under objective estimation must provide the necessary documentation or any other means of proof that serves to prove the income required in this provision.
What if I stop meeting the requirements?
Those who apply for this benefit may waive it at any time before August 31, 2020. The benefit may also be repaid if it is determined that the income received during the third quarter of 2020 exceeds the established thresholds. The collaborating mutual insurance companies and the Social Institute of the Navy, as applicable, will carry out the corresponding verifications.
And if I am a seasonal self-employed worker…
Am I entitled to any benefits?
Yes, as a new measure, seasonal self-employed workers are entitled to the extraordinary benefit for cessation of activity. To qualify, they must have been registered and contributing as such for at least five months between October and March in the two previous years (2018 and 2019).
In addition to being up-to-date with payments, other requirements must be met, such as not having been employed for more than 120 days between March 1, 2018, and March 1, 2020. Furthermore:
– Not having been registered or considered registered under any scheme during the months of March to June 2020.
-Not having received any social security benefits during the months of January to June 2020, unless it was compatible with self-employment.
– Not having obtained income exceeding 23,275 euros during the year 2020.
– If payments are not up to date, the self-employed individual will have thirty calendar days to pay the outstanding contributions
How much will I charge?
The amount of the benefit will be equivalent to 70% of the corresponding minimum contribution base.
From when will the extraordinary benefit be received?
Effective from June 1, 2020, and with a maximum duration of 4 months, provided the application is submitted between July 1 and 15. Otherwise, the effect will be fixed from the day following the submission of the application.
It can also be requested at any time during the period between June 27, 2020 and October 2020.
Do I have to continue paying the fees if I am granted the extraordinary benefit?
As was the case with the extraordinary benefit, during the receipt of the benefit it will not be mandatory to pay social security contributions, and the self-employed worker will remain registered.
Does it present any type of incompatibility?
The benefit will be incompatible with employment and with any Social Security benefit that is not compatible with registration as a self-employed worker.
The benefit will be incompatible with self-employment or freelance work if the income received during the year 2020 exceeds 23,275 euros.
What if at some point I stop meeting the requirements?
Self-employed workers who apply for this benefit may waive it at any time before August 31, 2020. They may also voluntarily return the benefit when they believe that the income received during the third quarter of 2020 will exceed the indicated thresholds.
What documents do I need to bring?
The application form provided by each mutual insurance company, in which you can authorize the company to consult the tax data corresponding to the second half of 2020.
If authorization is not granted or the mutual insurance company cannot access them, they must provide a copy of form 390, the annual summary VAT declaration for 2020, and a copy of form 130, corresponding to the self-assessment in installment payment of Personal Income Tax (IRPF) for the fourth quarter of 2020.
Self-employed individuals who pay income tax (IRPF) under the objective estimation method must provide the necessary documentation to prove the income required in this provision
You can contact this professional office for any questions or clarifications you may have.
Warm regards,
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A Àmbit Assessor, SL has 40 years dedicated to the tax, comptable and labor consultancy of the Pime.
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