New Social Security Contributions 2017 Revealed

As we are all acutely aware, sole-traders have faced numerous challenges and an uphill battle with the government

As we are all acutely aware, sole-traders have faced numerous challenges and an uphill battle with the government in order to secure better and fairer conditions that would benefit their businesses. Normally our Social contributions increase in January of every year, not so in 2017 as the rates were frozen according to the State Bulletin in February. However, it would seem there has been new movement in this area since the General State Budget was submitted last Friday and the government  in a new twist intends to increase the minimum rate for sole-traders by 3%.

I know I have explained the procedure in previous posts but for those of you who do not know, since we do not have a fixed salary, the government establishes an approximate base rate salary for sole-traders and our Social contribution is calculated based on said base rate salary.

For example, the established base rate was set at 893,10 euros a month (what the government considers to be the minimum amount to earn in order to live). Based on that, our monthly contribution is calculated in the following way:

General Contingencies: 236,67 euros (26,5%)

Temporary Incapacity: 30,37 euros (3,3%)& Obligatory contribution as per Law 51/2007: (0,1%)




According to the information released by the government, the base rate could be increased from 893,10 euros to 920 euros which will affect the amount we as sole-traders pay each month (approximately 275,08 euros per month for those on the minimum base rate, an 8 euro increase on the current rate). It is expected this increase will start from July but that it will not incur back payments. I say “could” because even on today’s date, nothing is 100% certain. The same patience we have shown regarding enforcement of the new measures to help improve our conditions as business owners may have to be shown here also.


Corporate Sole-Traders

Sole-traders who form part of a corporation unfortunately do not benefit from reduced rates as other newly registered sole-traders do. In fact they pay more. In 2017, approximately 1 million corporate sole-traders fall into this category and have faced an 8% increase on their minimum rate, meaning they pay 344,69 euros per month (a 25,53 euros per month increase in relation to last year). This is a massive concern for anybody in this category and one of the demands we are awaiting from the government to respond to.


To summarize, we have to keep tabs on the proposed changes for July and hopefully I will be able to forewarn you if these changes do in fact come into effect at that time.

About Sabrina L. Williams

Although I was born in the UK, I moved to the Canary Islands, Spain at a young age and I haven't looked back. The Canaries is a fantastic place to live, I mean you can do all types of outdoor activities practically all year round because of the great weather. Horses are my poison but the islands are also a superb spot for water sports so they do attract a lot of attention from people around the world. Anyway, enough about that. Back in 2011, I made one of the biggest, scariest yet best decisions I'd ever made and set-up my own business in the middle of a recession. I love what I do as no two days are the same, plus Spanish law keeps me on my toes as it is constantly changing (often without warning!) so there is always something new to learn. As I've branched out in the world of Administrative Consultancy, I decided to create a blog to discuss topics of interest to others in my industry and my clients, share tips and experiences, to see what new ideas people have for improving their businesses and the like so I hope you'll find the time to join me on this venture...

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