Governments around the world have issued fiscal and economic decisions to alleviate the effects of the cessation of activity resulting from the Covid19 crisis.
In Spain, measures have also been taken, including extraordinary performance for cessation of activity. There are two types of benefits for self-employed, depending on their situation.
- Self-employed persons who cannot work because they are under medical leave from coronavirus contagion or mandatory isolation. Covid-19 will be considered as an accident at work and not as a common disease. For the self-employed who trade on the minimum base to the social security the payment is 23.61 euros per day.
- The Self-employed who cannot run their business and who lose customers and income as a result of the declaration of the State of Emergency or restrictions on economic activity , or suffer a 75% drop in income/turnover are entitled to be exempt from paying contributions to the Social Security and will receive a benefit of a minimum of 661 euros. Duration of the aid is one month or until the last day of the State of Emergency (now extended until June 7).
Electric social bonus.
Intended for those self-employed who have had to cease their activity or who have their income /turnover reduced by 75%. Bills for gas and electricity supplies may be suspended for six months.
Town hall aids:
In addition to aid for families through food vouchers, food packages, medicines or home care, they have created specific aid for businesses eg the Ayuntamiento of Almuñecar will give a grant of 200 euros to businesses that had to cease their activity during the pandemic ; Salobreña will disinfect essential services businesses free of charge.
Junta de Andalucía aids:
Grant of 300 euros to most of the collectives, being compatible with other state and local aid. Other grants are aimed at the implementation of telework, aid for the payment of leases for business premises and they also provide microcredits from 9,000 to 15,000 euros for self-employed, endorsed by “Garántia” and with a duration between 3 and 5 years offering 1 year of interest free.
Deferral of payment of tax debts due between 13 March and 30 May for a maximum period of six months, the first three without interest.
Exemption from VAT to the supply of goods and services provided to clinics or hospitals.
A reduced VAT rate of 4% for cultural products/activities.
Self-employed who are taxed by the system of “objective estimation” or “modules” may waive this modality for 2020 and can declare their income and VAT payments on “direct estimate” and may return to the module estimate in 2021. Or they can choose not to count the days of the State of alarm for the purposes of IRPF and VAT if they continue to tax by regimen of objective estimate.
Possibility of disposition of pension plans: All self-employed persons who have ceased or suspended their activity or have their income/turnover reduced by 75% may request part of their reimbursement of their pension plans. The deadline for making the request is six months from the time the State of Emergency was decreed.
ERTE (Temporary Suspension of Employment) :
Articles 22 to 25 and 28 RDL 8/2020, 17 March
- Force Majeure – In this case the self-employed (same as other employers), as well as not having to pay the wages of the workers concerned, are exempt from all the contributions of the Social Security of all the workers concerned (subject to the condition that the contracts of the workers concerned remain valid for a period of 6 months after the end of the State of Emergency.
- ERTE of technical, economic, and production causes related to Covid-19. In cases where the company decides to suspend the contract or reduce the working hours of its workers for economic, technical reasons but without achieving the consideration of force majeure. This ERTE unlike the force majeure, does not allow the employer to be exempt from the payment of social security contributions.
Leases for use other than housing.
All self-employed registered in social security, or, on 14 March and whose activity has been suspended or have their income /turnover reduced by 75% may apply within one month of the entry into force of the RDL (23 April to 23 May) for a moratorium on the basis of paying the rent for a maximum period of 4 months, without interest and within a maximum period of two years from the end of the State of Emergency, provided that within that period the term of the contract is maintained.
This request does not oblige all landlords, only those who are companies or public housing entities or have the consideration of a large holder (owners of more than 10 properties are obliged to accept it).