If you are or you will be self-employed, you should know that there are two methods for calculating the amount to be paid to the Treasury each trimester:
- Objective Estimation, also called Modules regimes.
- Direct Estimation.
Thus, today, we would like to inform you a bit about Modules regimes and answer the most frequent questions.
What is a Module?
It is a simplified tax regime that is applicable to small entrepreneurs and / or professionals, in an attempt to simplify the management of their activity.
Who can access Objective Estimation Modules?
Entrepreneurs and professionals who meet the following requirements:
- That each of its activities are included in the Order of the Ministry of Finance that develops objective assessment schemes and do not exceed the limits set out therein for each activity.
- The volume of integrity yielded in the previous year does not exceed any of the following amounts: 450.000 euros for the whole of the economic activities or 300.000 euros for all farming activities.
- The volume of purchases of goods and services in the previous year, excluding acquisitions of assets (investments), does not exceed the amount of 300.000 euros annually. If the activity already began, purchasing volume will rise annually.
- To practice withholdings of 1% on their invoices. In this regard and as a new source of exclusion, you may not continue in modules regime if you have had in the last year higher yields than 225.000 euros per year in general or 50.000 euros per year, provided that more than 50% of your revenues come from companies and therefore are subject to withholding.
- That you have not resigned or have been excluded from the simplified VAT regime.
- That you have not expressly or tacitly renounced the application of this regime.
However, you should also consider:
- Retain issued and received invoices and the receipts of the applied modules.
- If amortizations are carried out, the register of investment goods should be practiced.
- In activities whose net income is calculated based on the volume of transactions, (agriculture, livestock, forestry and processing of natural products), a Record Book of sales and income should be developed.
What are the percentages for entrepreneurship?
Except for farming activities, the percentages are as follows:
- In general (more than a salaried worker) 4 percent performance resulting from the application of the modules based on existing data to January 1st.
- When you only have one salaried worker, 3 percent.
- When you don’t have staff or a salaried worker, 2 percent.
How should payments be made?
They should be carried out every trimester through the model 131 on account of the Income Tax for Individuals within the following periods:
- 1st QUARTER: between 1 and 20 April
- 2nd QUARTER: between 1 and 20 July
- 3rd QUARTER: between 1 and 20 October
- 4th QUARTER: between 1 and 30 January of the following year
- But if you still have doubts about what would be the most advisable option for your business, our team of lawyers and tax consultants in Daemi Zabalza & Asociados specialized in all kinds of legal, fiscal and labour law, will advise and answer your questions professionally and present the most convenient solution for your company.