New support measures for the self-employed contained in RDL 30/2020. Due to the persistence of the negative effects on companies and employment of the health emergency caused by Covid-19.
In addition, a new extraordinary benefit has been created for cessation of activity. In favour of those self-employed persons who are forced to suspend their activities completely by virtue of resolutions which may be adopted by the competent authority. As a measure to contain the spread of the COVID-19 virus
Support measures for the self-employed
The first measures regulate an extraordinary severance pay for the self-employed according to their case.
Those affected by suspension of activity by decision of the competent authority
From 1/10/20, self-employed workers who are forced to suspend all their activities as a result of a decision taken by the competent authority as a measure to contain the spread of the COVID-19 virus, will be entitled to an EXTRAORDINARY severance payment.
Requirements
- In registration at least 30 calendar days before the date of the resolution agreeing to the cessation of activity.
- Be up to date with the payment of Social Security contributions.
Amount
- 50% of the minimum contribution base corresponding to the activity carried out. On a minimum basis of 944.40 euros, 472.20 euros would be charged.
- This amount will be increased by 2% if the self-employed worker is recognised as a member of a large family. And the only income of the family unit or similar during this period comes from their suspended activity.
- When people live together in the same home as a family or similar cohabitation unit. Up to the first degree of kinship by blood or affinity, and two or more members are entitled to this extraordinary benefit of cessation of activity. The amount of each of the benefits shall be 40%, the provision mentioned in the previous section for large families not being applicable.
Beginning of the right and duration
From the day following the adoption of the closure measure by the competent authority and ending on the last day of the month in which it is agreed to lift it.
The time of receipt of the benefit shall not reduce the periods of severance pay to which the beneficiary may be entitled in the future.
Maintenance Registration and Exemption Contribution
During the time that the activity is suspended, the registration in the corresponding special regime shall be maintained, and the self-employed worker shall be exonerated from the obligation to make contributions. Exemption from the payment of contributions shall be extended from the first day of the month in which the activity closure measure is adopted until the last day of the month following that in which the measure is lifted.
Period during which the self-employed worker is exempt from the obligation to contribute
Incompatibility
Receipt of the benefit is incompatible with
- The receipt of remuneration for the development of an employed activity, unless the income from the employed activity is less than 1.25 times the amount of the IMS.
- Also with the performance of another self-employed activity.
- With the receipt of income from the company whose activity has been affected by the closure.
- With the receipt of a social security benefit. Except for that which the beneficiary has been receiving as being compatible with the performance of his work.
Self-employed persons claiming a reduction in income
And that either they do not pay contributions due to cessation of activity or they are not entitled to the ordinary benefit of cessation of activity. Provided in the fourth additional provision of this RDL. Nor to the benefit for cessation of activity regulated in articles 327 and following of the general social security law. Approved by means of RDL 8/2015, of 30th October (Art. 13).
From 1 October 2020, they will be able to access an extraordinary economic benefit for the cessation of activity.
Requirements
- Be registered as a self-employed person before 1 April 2020.
- Be up to date with payments.
- Not be entitled to a severance pay regulated by these same measures (additional 4th disposition or ordinary severance pay right)
- Not to have income from self-employed activity in the last quarter of the 2020 financial year higher than the MIS.
- To suffer, in the fourth quarter of 2020, a reduction in income from self-employed activity of at least 50% in relation to the income earned in the first quarter of 2020.
Amount
- It will be 50% of the minimum contribution base corresponding to the activity carried out.
- Nevertheless, when people live together in the same home as a family or similar unit up to the first degree of kinship by blood or affinity. And two or more members are entitled to this extraordinary benefit of cessation of activity. The amount of each of the benefits shall be 40%.
Beginning of the right and duration
It may begin to accrue with effect from 1 October 2020 and will have a maximum duration of 4 months. Provided that the application is submitted within the first 15 calendar days of October. Otherwise, the effects are fixed on the first day of the month following the submission of the application and may not exceed 31 January 2021.
Incompatibility
Receipt of the benefit is incompatible with
- The receipt of a payment for the development of an employed work. Unless the income from employment is less than 1.25 times the amount of the IMS.
- With the performance of another self-employed activity.
- With the receipt of income from the company whose activity has been affected by the closure.
- Finally, with the receipt of a social security benefit. With the exception of that which the beneficiary was receiving as being compatible with the performance of the activity he was carrying out.
Maintenance Registration and Exemption Contribution
- During the time of receipt of the benefit, the registration in the corresponding special regime will be maintained and the self-employed worker will be exonerated from the obligation to contribute.
- The period during which the self-employed worker is exempted from the obligation to contribute shall be understood to be a period of contribution.
- Self-employed workers who receive this benefit and are not paying contributions due to cessation of their activity shall be obliged to pay contributions for this concept from the month following that in which they receive the benefit.
It should be noted that as regards the exemption of self-employed workers’ contributions, the latter pay the contribution, but the mutual insurance company gives it to them with the benefit.
Management
The entities in charge of the management of this service shall make the appropriate provisional decision, accepting or rejecting the right. In accordance with the request submitted and the documents, if any, provided,
An affidavit of income, if any, from employment must be submitted with the application.
The managing entity may ask you to submit:
- A company certificate
- The tax return
When applying for the benefit, the person concerned must inform the mutual fund or the body managing the benefit of the members of the family unit and whether any of them is or may be a recipient of the cessation of activity benefit or if they have any other type of income.
Interim reviews adopted
- From 1 March 2021, all interim decisions will be reviewed. To this end, the mutual insurance companies collaborating with the Social Security, provided they have the consent of the interested parties, or the ISM will obtain the tax data corresponding to the year 2020 for self-employed workers from the Ministry of Finance.
- In the event that it is found that the interested party is not entitled to the benefit, and if they have not previously waived their right, the procedures for claiming the amounts unduly received will be initiated.
To this end, the competent body for the recognition of the benefit will issue a decision fixing the amount of the sum to be reimbursed. This must be done without interest or surcharge within the period determined in the decision.
Once the term established in the resolution issued for this purpose has elapsed, the TGSS will proceed to claim the outstanding debt, with the appropriate surcharges and interest in accordance with the administrative procedure for collection established in the General Regulations for the Collection of Social Security, approved by Royal Decree 1415/2004, of 11th June.
Other support measures for the self-employed
There are other measures for seasonal self-employed workers, as well as legislation for the right to unemployment benefit, compatible with self-employment.
This is regulated in the 4th Additional Provision of RED 30/2020, which also provides for an extension of the benefits for cessation of activity compatible with self-employment, which were regulated in June 2020, and affected workers who declared that they would receive a 75% drop in income in the third quarter of the year.
Thus, self-employed workers who, when this regulation came into force, were receiving the benefit for cessation of activity provided for in article 9 of Royal Decree Law 24/2020, of 26 June, on social measures for the reactivation of employment and protection of self-employment and competitiveness in the industrial sector, may continue to receive it until 31 January 2021, provided that during the fourth quarter of 2020 they maintain the requirements established for its concession.
Likewise, self-employed workers who have not received this benefit during the third quarter of 2020 may request the benefit for cessation of activity provided for in Article 327 of the LGSS, provided that the requirements established in paragraphs a), b), d) and e) of Article 330.1 of the regulation are met and they have received until 30 June the extraordinary benefit for cessation of activity provided for in Article 17 of Royal Decree Law 8/2020, of 17 March, on extraordinary urgent measures to deal with the economic and social impact of the COVID-19.
Requirements
Access to this extension of the benefit or, where applicable, to the benefit will require proof of a reduction in turnover during the fourth quarter of 2020 of at least 75% in relation to the same period in 2019, as well as not having obtained net returns of more than 5,818.75 euros during the indicated quarter of 2020.
In order to determine the right to the monthly benefit, the net yields of the fourth quarter will be prorated, and may not exceed 1,939.58 euros per month.
In the case of self-employed workers who have one or more dependents, proof must be provided at the time of applying for the benefit that all labour and Social Security obligations have been met. To do so, they will issue a responsible statement, and may be required by the mutual insurance companies that collaborate with the Social Security or by the managing entity to provide the necessary documents that prove this.
Duration
This benefit may be received until 31 January 2021 at the latest, provided that the worker is entitled to it under the terms set forth in Article 338 of the LGSS.
Likewise, those self-employed workers who on 31 October were receiving the severance pay recognised under Article 9 of Royal Decree Law 24/2020, of 26 June, and who have exhausted their right to the severance pay provided for in the aforementioned precept before 31 December 2020, shall receive this benefit until 31 January 2021, provided that they meet the requirements for this purpose.
From 31 January 2021, this benefit for cessation of activity may only be continued if all the requirements of Article 330 of the LGSS are met.
Recognition
Recognition of the benefit will be carried out by the partner mutuals or the ISM on a provisional basis with effect from 1 October 2020 if requested before 15 October, or with effect from the day following the request in other cases, and must be regularised as from 1 March 2021.
Amount
- 70% of the average regulatory base of the quotation of the last 12 months.
- If the worker is multi-active and meets the requirements for access, he will receive 50% of the minimum contribution base according to his activity.
Tax data
From 1 March 2021, the mutual insurance companies collaborating with the Social Security, provided they have the consent of the interested parties granted in the application, or the ISM will obtain from the Ministry of Finance the tax data for the 2019 and 2020 financial years necessary to monitor and control the recognised benefits.
If the mutual insurance companies collaborating with Social Security or the ISM are unable to access the data held by the tax authorities, self-employed workers must provide the mutual insurance company with the data within ten days of the request:
- A copy of form 303 for self-assessment of VAT. This corresponds to the declarations for the fourth quarter of 2019 and 2020.
- Copy of form 130 corresponding to the self-settlement of the payment in instalments of personal income tax for the second and fourth quarters of the years 2019 and 2020. For the purposes of being able to determine what corresponds to the fourth quarter of those years.
- Self-employed workers who pay income tax by objective estimation (model 131). They must provide the necessary documentation or any other means of proof that serves to accredit the income required in this precept.
Contributions
The self-employed worker, during the time he or she is receiving the benefit, must pay all the contributions to the TGSS. Applying the current rates to the corresponding contribution base.
The collaborating mutual insurance company, or if applicable, the Social Institute of the Navy, shall pay the worker the amount of the contributions for common contingencies that he or she would have been entitled to pay. If the self-employed worker is not engaged in any activity, pursuant to the provisions of article 329 of the LGSS. Along with the severance pay
Permanent cessation of activity
In the event of permanent cessation of activity prior to 31 December 2020. The limits of the requirements set out in this paragraph shall be taken into account in proportion to the duration of the activity. For this purpose the calculation shall be made taking into account in its entirety the month in which the termination of the social security system in which the activity took place.
Waiver or refund
In all cases, the self-employed worker who has requested payment of the benefit regulated in this article may
- Renounce it at any time before January 31st 2021, with the renunciation taking effect the month following its communication.
- Return the benefit for cessation of activity on his own initiative. Without having to wait for a claim from the collaborating mutual insurance company or from the managing entity. When it considers that the income received during the fourth quarter of 2020 or the fall in invoicing in the same period will exceed the thresholds established in section 2 with the corresponding loss of the right to the benefit.
Compatibility
The severance pay may be compatible with employment, the conditions applicable in this case being
the following:
- Net income from self-employment and income from employment may not exceed 2.2 times the MIS. In determining this calculation, income from employment shall not exceed 1.25 times the amount of the minimum wage.
- The amount of the benefit will be 50% of the minimum contribution base corresponding to the activity. An affidavit of income from employment shall be submitted with the application. Without prejudice to the obligation to present a company certificate and tax return to the entity managing the benefit.
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