Personal income tax for self-employed workers in 2018

The 20% retention for non-professionals is maintained

It can be 7% for 2 years for entrepreneurs and 15 for professionals

The Personal Income Tax (IRPF) in 2018 has undergone some changes that essentially affect self-employed workers, especially those who start their own business in 2018 or who are in charge of commercial companies. During this year, the withholdings will be 7% for those who start their activity now; a benefit applicable during the next two years. The general self-employed will have a rate of 15%.

Non-professional self-employed workers

This category includes those who carry out an activity whose heading does not appear in the Tax on Economic Activities (IAE), for example mechanics or restaurateurs. In these cases, the IRPF remains as in 2017, that is, in a 20%, and is calculated as follows: this percentage is calculated on the profits that the company has obtained quarterly and is paid by submitting form 130 to the Treasury.

This document calculates the income and expenses of the first quarter and the 20% is obtained from the profit. In the second quarter, the income and expenses of the first quarter must be calculated, in addition to those of the second, applying the same amount, and so on. At the end of the year, all payments on account of personal income tax will have been made, in the event that a profit was made in any quarter.

There are also other IRPF withholdings that tax cases in which both self-employed and staff workers have to report to the tax authorities and pay a percentage, since it is understood that they are extraordinary income. One of them is the income received for participating in a company's board of directors. In 2018, they have a fixed applicable rate of 19% provided that the turnover has not exceeded 100,000 euros. If it is higher, this increases to 35%.

Income obtained from courses, conferences and seminars is subject to a withholding of 15%, the same amount as in the case of the production of cultural or scientific works or in the case of extraordinary income received corresponding to arrears from previous years.