We would like to inform you that a Supreme Court ruling has recently been published, establishing the possibility that a self-employed business owner can benefit from the so-called "Flat Rate" in the contributions paid to Social Security, a bonus that the Administration had previously denied recognition of.
The so-called "Flat Rate" is regulated in Article 31.1 of Law 20/2007, of July 11, the Statute of the Self-Employed Worker. It stipulates that a self-employed individual (registered under the Special Regime for Self-Employed Workers - RETA) who chooses to contribute at the minimum rate can benefit from a reduction in their Social Security contributions. This reduction consists of a fixed amount of €60 for the first 12 months. If a higher contribution rate is chosen, the reduction is set at 80% for the first 12 months, provided that the registration in the Special Regime for Self-Employed Workers is for the first time, or that they have not been registered in the same regime during the two immediately preceding years. After these first 12 months, the reductions are set at 50% for the following six months and 30% for the following three months.
As we have said, until now the Administration had been denying such incentive to self-employed business owners, considering them a different figure within the self-employed group itself and arguing that the regulatory provision did not expressly mention them in access to the bonus, thus applying a restrictive interpretation of the legal rule.
This interpretative criterion of the General Treasury Administration of Social Security has been the subject of different litigation in the courts of different territories of the country, reaching such relevance that our Supreme Court has ruled on it on several occasions, determining that the restrictive criterion used by the Administration is not applicable and, therefore, the self-employed partners (partners of capital companies) who make initial registration in the RETA have the right to enjoy such incentive, considering that the intention of the legislator with the regulation of the indicated bonus is to favor the start of work activity, without establishing any limitation to the self-employed partners.
Therefore, and given that there are several Supreme Court rulings in this regard, we understand that it has established a precedent, so that self-employed business owners who register from now on will be able to enjoy this incentive and, with respect to those already registered in this system, they could request from the General Treasury of the Social Security the amounts of their contributions paid in excess due to not having applied the aforementioned "Flat Rate" bonus, it being estimated that on average each self-employed business owner could recover approximately 4,000 Euros, depending on their registration date and contribution base.
However, it's important to keep in mind the statute of limitations, as claims against the Social Security Administration expire after four years. Therefore, only self-employed business owners who meet all the legally established requirements and whose registration in this scheme occurred in 2016 or later are eligible to request a refund of undue payments. This claim must be filed directly with the Social Security Administration, providing supporting documentation proving access to the funds. The Administration has six months to issue a decision. If it fails to respond within this timeframe, the claimant should continue to pursue administrative channels. If the Social Security Administration itself remains silent, the claimant can then take legal action.
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A graduate in Law from the University of Barcelona, she also completed a Master's degree specializing in Labor Law and Social Security at the Barcelona Bar Association. She began her professional career as an intern while studying and later joined the Navarro Law Firm as an employment lawyer, advising companies nationwide on labor law matters and representing them before the Labor Courts, the Labor Inspectorate, in conciliation proceedings, etc. In February 2017, she joined Àmbit Jurídic i Econòmic as a professional partner after extensive experience as an employment lawyer.
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