New regulation of the 2023 RETA contribution bases

Approved the Royal Decree 665/2024 of July 9th, which modifies the General Regulation on Contributions and Settlement of other Social Security Rights.

The past year 2023 was the first year in which workers included in the Special Regime for Self-Employed Workers (RETA) contributed based on their annual net income.

The main premise in the implementation of this new contribution system is that, for the purpose of determining the contribution bases, all the net income obtained by the aforementioned workers during each calendar year from their various professional or economic activities must be taken into account.

In this way, the General Budget Law (LPGE) establishes a general table and a reduced table of contribution bases for this special regime. Both tables are divided into consecutive ranges of monthly net income amounts. Each of these ranges of net income is assigned a minimum monthly contribution base and a maximum monthly contribution base.

Considering the above, the contribution bases chosen by the self-employed workers each year are considered provisional until the annual regularization is carried out.

To carry out this annual regularization, Social Security, taking into account the tables established in the LPGE and the information on net income obtained in 2023 that the Tax Agency will provide, will proceed ex officio to determine the contribution bases that should have been contributed to in 2023 and consequently establish the regularization of contributions corresponding to the difference between the provisional contribution paid during the year and the real and appropriate contribution as of December 31, 2023.

This mentioned regularization may result in the payment of the differences by the workers or in a refund of contributions by Social Security. Thus, the General Treasury of Social Security will soon send notifications to communicate the result of these regularizations, if applicable.

In this regard, the regulatory development of what has been explained so far has recently been published in Royal Decree 665/2024 of July 9th, which modifies the General Regulation on Contributions and Settlement of other Social Security Rights, approved by Royal Decree 2064/1995 of December 22nd. The contained modifications focus on specifying the calculation of the Social Security contribution resulting from the regularization procedure, as well as improving certain aspects of the rules to determine whether regularization is necessary or not and specifying the method of carrying out the annual regularization of income.

To this effect, as of August 1, 2024, the following new features are incorporated into the regulatory regulation of the annual regularization procedure for contributions in the RETA:

1. For the settlement of the corresponding contribution, not only must the income derived from the economic, business, or professional activities of the self-employed worker be taken into account, but also the rest of the data available at the time of the regularization that are determinant for the calculation of the contributions due for each of the settlement periods comprising the annual period subject to regularization.
2. Regarding the verification of the applicable range of net income from the general or reduced table, in the case of collaborating self-employed workers, self-employed company workers, and working partners of labor companies, if the determined range of monthly net income is included in the reduced table of contribution bases, the contribution base determined by the corresponding LPGE as the minimum contribution base for common contingencies for workers included in the RGSS of contribution group 7, €1,323 for this 2024, will apply (instead of the minimum base of range 1 of the general table of contribution bases, as previously provided).
3. In relation to the rules for determining whether the regularization of the contributions paid during 2023 is appropriate, the range obtained in the regularization, and the average monthly contribution base:

a) If the average monthly contribution base is between the minimum and maximum monthly base of the corresponding range, the regularization of the provisional contribution bases and contributions will not proceed, and these will become definitive.

b) If the average monthly contribution base is lower than the minimum base of the corresponding range, the definitive contribution base will be the minimum base of that range, and the contributions that correspond based on the total differences, positive or negative, between the provisional contribution bases for each month and the minimum contribution base corresponding to the range will be claimed, if applicable, in a single act through this regularization procedure, without prejudice to considering any other contribution differences derived from the data available at the time when said regularization process is carried out, regardless of whether these may affect periods whose provisional contribution bases become definitive.

If the combined result of the regularization of the provisional contribution bases and the detected contribution differences according to the available data results in a contribution difference to be paid by the interested party, they must pay the difference amount by the last day of the month following the notification of the regularization result, without applying any late payment interest or surcharge if paid within that period. The payment of these differences must be made using the payment document provided by the General Treasury of Social Security in the notification of the regularization result, or made available to the interested parties through the corresponding telematic services.

When the contributions are not paid within the indicated period, the administrative claim for these contributions will proceed according to the general procedure established for the collection management of the Social Security system.

c) If the average monthly contribution base is higher than the maximum base of the corresponding range, the definitive contribution base will be the maximum base of that range, and the contributions corresponding to the total differences, positive or negative, between the maximum contribution base corresponding to the range and the provisional contribution bases for each month will be refunded ex officio, if applicable, in a single act through this regularization procedure, without prejudice to considering any other contribution differences derived from the data available at the time when said regularization process is carried out, regardless of whether these may affect periods whose provisional contribution bases become definitive.

In this regard, the General Treasury of Social Security will refund the amount due without applying any late payment interest, before April 30th of the following year in which the corresponding tax administration has communicated the computable income.

d) In the case of self-employed workers who, as of December 31, 2022, were contributing based on a contribution base higher than what would correspond to them based on their income, they may, regardless of whether the provisional contribution bases they have chosen during the year in question were higher or lower than the one corresponding to December 31, 2022, choose to maintain, through the corresponding waiver of the refund of contributions, as definitive bases the provisional bases in the event that their average is higher than the base that would correspond according to the regularization, provided that said average is not higher than the contribution base that would apply to them as of December 31, 2022, in which case this latter base will apply.

The waiver of the contribution base calculated as a result of the regularization may be requested until the last day of the calendar month immediately following the one in which the regularization result is communicated and will imply, if applicable, the waiver of the possible refund of contributions.

Even if the waiver referred to in the previous paragraph has been requested, a refund of contributions will be made ex officio for the corresponding amount of the difference between the average of the provisional contribution bases and the contribution base corresponding to December 31, 2022, when that average is higher than the latter.

Therefore, an interesting option is established for those who wish to maintain the higher contribution base established as of 31.12.2022, in relation to the actual income obtained in 2023, for the purpose of obtaining better retirement or disability benefits, among others.

From the Employment Advisory department of Baker Tilly Spain, we remain at your disposal to expand on this information or to resolve any questions that may arise related to this article.