Autónom@s in Spain & self-employed in USA (LLC)
Autónom@s in Spain & self-employed in U.S.A. (LLC)
A self-employed person (Autónom@) in Spain is someone who works independently; that is, they are not employed by a company or employer, but rather carry out economic or professional activities independently. Self-employed individuals typically offer services or products directly to clients or businesses and are responsible for managing all aspects of their activity, including invoicing, taxes, and social security contributions.
Registering with the Special Regime for Self-Employed Workers (RETA) and registering for tax purposes
To start working as a self-employed person, you usually need to register with the Tax Agency (AEAT) on economic activities and register with the RETA (Regimen Especial de Trabajadores Autonomos) at the Social Securirty.
The declared activity is important because it can determine everything from the types of expenses you can deduct to your tax and formal obligations.
Regarding the CNAE 2025, the classification of economic activities is officially regulated and serves to identify your activity. The regulations have approved the new CNAE code, and the updated code is being implemented according to the established schedule.
https://www.boe.es/eli/es/rd/2025/01/14/10
VAT and Modelo 303
Self-employed individuals generate their income from their invoices. Generally, if the activity is subject to VAT and not exempt, they must charge VAT on their invoices. There are exceptions, such as certain exempt activities or some transactions with clients outside the European Union, although in these cases the type of transaction and the place of supply rules also apply.
When VAT is due, the self-employed individual must submit Modelo 303 to the Tax Agency, usually on a quarterly basis.
Personal Income Tax (IRPF): Installment Payments (Modelo 130) and Withholdings.
In general, self-employed individuals must file Modelo 130 to make their quarterly IRPF payments. However, there are exceptions: those taxed under the simplified tax regime (objective estimation) use Modelo 131; and in professional activities, if more than 70% of income comes from invoices with withholding tax (for example, with a 15% withholding rate), it is usually not necessary to file Modelo 130, since the IRPF is paid on account through these withholdings.
Tax-deductible expenses
Self-employed individuals make quarterly income tax (IRPF) payments, calculated based on their income and expenses for the period. It is essential that expenses are properly documented and tax-deductible, as not all expenses are accepted by the Spanish Tax Agency.
Self-employed in the U.S. and coordination with Spain
Self-employed individuals in the U.S. receive Form 1099 or 1042 from their employers at the beginning of the year and must complete Schedule C of Form 1040 or 1040NR in the U.S. If invoicing is done through an LLC or an S-Corp, taxes are paid directly through Schedule C. Incidentally, Spain does not consider these entities to have legal personality, so the taxpayer must include the LLC’s net profits in the “Attribution of Income” section of their Personal Income Tax (IRPF) return.
The Spanish Tax Agency (AEAT) considers economic activity to take place in Spain when the taxpayer resides in Spain, even if they invoice or receive payments through US accounts or use US structures (LLCs).
US-Spain Totalization Agreement
The US-Spain Totalization Agreement is a social security agreement that prevents double contributions and helps protect the rights of those who have worked in both countries.
Avoid double contributions: Workers who work temporarily in the U.S. or Spain only contribute to the Social Security system of their country of origin, avoiding paying contributions in both countries simultaneously. This especially benefits expatriates and companies with employees abroad.
Allow you to combine retirement contributions: If a person has contributed to both countries but does not meet the minimum contribution period requirements in one of them, they can combine the periods of contributions in both systems to access benefits such as retirement, disability, or survivor benefits.
What can we do at US Tax Consultants?
At US Tax Consultants, we can manage your registration as a self-employed individual and assist you with preparing and filing your tax obligations with the Spanish Tax Agency and Social Security, as well as with your US tax return (Form 1040/1040NR) when applicable, including Schedule C.
Don’t hesitate to contact us if you have any questions or to request a Free Consultation.