The freelancer's tax vocabulary, without the jargon

IRPF (personal income tax) is the tax you pay on your profit as a freelancer in Spain: what you earn after deducting expenses. During the year it's prepaid in one of two ways: through the retención your Spanish clients apply, or through the modelo 130.

The modelo 130 is the quarterly return through which a freelancer prepays the tax office 20% of their accumulated net profit as IRPF. You file it if less than 70% of your professional income was subject to retención de IRPF.

Estimación directa is the regime most freelancers use to calculate their IRPF: you pay tax on your real profit, that is, your income minus your deductible expenses. It's the default system, as opposed to módulos.

Retención de IRPF is the part of your IRPF that your Spanish client subtracts from your invoice and pays to the tax office for you. The standard rate is 15%, or 7% during your registration year and the two calendar years that follow.

Módulos (estimación objetiva) is a regime where some freelancers calculate their IRPF using fixed parameters of their activity —floor space, staff, consumption— instead of their real profit. It's only available for certain activities.

IVA (value-added tax) is the tax you charge your client on each invoice and then pay to the Spanish tax office. It passes through your account but is never yours. The standard rate is 21% and it's filed quarterly with the modelo 303.

The modelo 303 is the quarterly IVA return: the difference between the IVA you charged your clients and the IVA you paid on your expenses. It's filed 1–20 April, July and October, and 1–30 January.

The recargo de equivalencia is a special IVA regime, mandatory for freelancers who sell retail without transforming the product. You pay slightly higher IVA to your suppliers and, in exchange, you don't file the modelo 303 or settle IVA yourself.

The modelo 390 is the annual IVA summary: an informational return that gathers all the modelo 303 returns you filed during the year. Nothing is paid with it; it only summarises what was already declared. It's filed 1–30 January.

IVA intracomunitario is how IVA works on operations with companies in other EU countries. If you're registered in the ROI and have a NIF-IVA, B2B services are invoiced without IVA (the client accounts for it) and the operation is declared in the modelo 349.

IVA-exempt operations (operaciones exentas de IVA) are activities that by law carry no IVA: you don't charge it to your client. Healthcare, regulated education or certain financial services are usually exempt. In exchange, you normally can't deduct the IVA on your related expenses.

The cuota de autónomos is the monthly payment to Social Security for being registered as a freelancer in Spain. Since 2023 it's based on your real net earnings: the more you earn, the more you pay, with brackets you can adjust up to six times a year.

The tarifa plana is the reduced cuota of €80/month that new freelancers pay during their first 12 months of activity, instead of the normal income-based cuota. It can be extended another 12 months if your net earnings stay below the minimum wage.

The base de cotización (contribution base) is the amount your cuota de autónomos and your future benefits (pension, sick leave) are calculated on. Under the real-earnings system you choose a base within the bracket that matches your income.

The RETA (Special Regime for Self-Employed Workers) is the Social Security regime freelancers contribute to in Spain. Being registered in the RETA gives you access to public healthcare, your pension, sick leave and other benefits.

Pluriactividad is being registered as a freelancer and, at the same time, working as an employee, contributing to two regimes at once. It can entitle you to reductions in your cuota and to a refund of excess contributions.

Gastos deducibles are the expenses of your activity you can subtract from your income to pay less IRPF and IVA. To deduct them they must be tied to your work, backed by an invoice, and recorded in your bookkeeping.

Amortización (depreciation) is how you deduct the cost of a durable business asset —a computer, furniture, a vehicle— spread over its useful life, rather than deducting it all in the year you buy it.

Periodificación is the accounting principle of assigning each item of income and expense to the period it belongs to, not the moment it's collected or paid. It makes each quarter's or year's profit reflect the real activity.

The modelo 100 is the annual income tax return (IRPF). It calculates the year's final IRPF and reconciles it with what was already prepaid through retenciones and modelo 130 payments. It's filed during the Renta campaign, usually between April and June.

The modelo 111 is the quarterly return through which you pay the tax office the IRPF you've withheld from others: employees on payroll or professionals who invoice you with retención. It's filed 1–20 April, July and October, and 1–30 January.

The modelo 115 is the quarterly return through which you pay the IRPF withholding you apply on the rent of premises used for your activity. The general withholding on leases is 19%, filed each quarter.

The modelo 349 is an informational return for intracommunity operations: purchases and sales of goods or services with companies in other EU countries. Nothing is paid with it; it only reports those operations.

The declaración trimestral is the set of taxes a freelancer files every three months: usually the modelo 303 (IVA) and, where applicable, the 130 (IRPF), the 111 or the 115. The windows are 1–20 April, July and October, and 1–30 January.

The declaración anual gathers the year-end summaries and adjustments: the Renta (modelo 100), the annual IVA summary (modelo 390) and, where applicable, informational withholding summaries. It closes and reconciles what was declared quarter by quarter.

A factura rectificativa (corrective invoice) corrects an invoice already issued: an error in the details, a return or a later discount. It must reference the original invoice and doesn't replace it: it amends it while leaving a trace of the correction.

A factura proforma (proforma invoice) is a preliminary document detailing an offer or quote before the real invoice. It has no tax validity: it creates no IVA obligation, doesn't count as income and doesn't replace the final invoice.

The alta censal is the procedure to register with the tax office as a freelancer, using the modelo 036 or 037. In it you declare your activity, your epígrafe, your tax obligations and your address. The 037 is the simplified version of the 036.

The epígrafe IAE is the code from the Tax on Economic Activities that classifies your activity as a freelancer. You choose it when registering with the modelo 036/037. Most freelancers are exempt from paying the IAE, but still have to declare their epígrafe.

The domicilio fiscal is the official address you give the tax office as a freelancer: where you receive notifications and where your administrative activity is based. It can be your home, and it's declared in the alta censal (modelo 036/037).