Being a self-employed psychologist: social security contribution, personal income tax [irpf] and how to invoice patients - practical psychology

Becoming a self-employed psychologist in Spain involves a series of tax and administrative obligations that are essential to understand in order to ensure the success and viability of your practice. This guide will provide you with the essential information about the self-employed Social Security contribution, the Personal Income Tax (IRPF) and the key points for invoicing your patients correctly.

The First Step: Register as Self-Employed

Before you start practicing, it is crucial that you register as self-employed. This process involves two main procedures:

• Registration in the Special Regime for Self-Employed Workers (RETA) of Social Security: This step allows you to contribute to Social Security and access health coverage and the corresponding social benefits.
• Registration in the Register of Businesspeople, Professionals and Withholders of the Tax Agency (Form 036 or 037): This procedure identifies you as a self-employed professional before the Tax Agency and allows you to issue invoices and declare your income. Form 037 is a simplified version of Form 036, and most self-employed psychologists can use it.

Choose the Correct IAE Category

When registering with the Tax Agency, you must choose the Tax on Economic Activities (IAE) category that best fits your activity. For psychologists, the most common category is 861 – Services provided by psychologists.

Self-Employed Contribution: How Much Will You Pay to Social Security?

The self-employed contribution is a monthly amount that you must pay to Social Security to be entitled to health coverage and social benefits. Since 2023, the contribution is calculated based on the self-employed worker's actual earnings.

The New Contribution System Based on Actual Earnings

The new system establishes a table with income brackets and a minimum and maximum contribution associated with each bracket. It is important that you make a realistic estimate of your income to choose the bracket that best suits your situation. You can change brackets every two months if your income varies.

The Flat-Rate Fee for New Self-Employed Workers

If you are a new self-employed worker, you can benefit from the flat-rate fee, which allows you to pay a reduced contribution during the first months of activity. This fee is usually 80 euros per month for the first 12 months, and then it increases gradually.

Reductions and Discounts on the Contribution

There are other reductions and discounts on the self-employed contribution for certain groups, such as women returning to work after maternity or self-employed workers with disabilities. Find out about the available options to see if you can benefit from any.

The IRPF: Quarterly and Annual Declarations

As a self-employed psychologist, you are required to declare the Personal Income Tax (IRPF) quarterly and annually.

Quarterly IRPF Declaration (Form 130)

Each quarter, you must submit Form 130, in which you declare your income and expenses for the quarter. This form allows you to calculate the net performance of your activity and pay the corresponding IRPF. Generally, a 15% withholding is applied to the invoices you issue to companies or professionals, which reduces the amount you must pay on Form 130.

Annual IRPF Declaration (Form 100)

At the end of the year, you must submit the annual IRPF declaration (Form 100), in which you declare all your income and expenses for the year. In this declaration, the tax situation for the year is regularized, taking into account the quarterly payments made.

Deductible Expenses in the IRPF

It is important that you know the expenses you can deduct in the IRPF, as this will allow you to reduce the amount of taxes you must pay. Some of the most common deductible expenses for self-employed psychologists are:

• Rent of the premises where you carry out the activity.
• Office and consultation supplies.
• Training and professional development expenses.
• Advertising and marketing expenses.
• Telephone and internet expenses.
• Tax and labor advisory expenses.

How to Invoice Your Patients: Obligations and Requirements

Invoicing your patients is a fundamental part of your activity as a self-employed psychologist. It is important that you comply with all legal requirements to avoid problems with the Tax Agency.

Invoice Requirements

Your invoices must include the following information:

• Invoice number.
• Date of issue.
• Your details (full name or company name, NIF, address).
• Your patient's details (full name, NIF/DNI, address).
• Description of the service provided (psychology session, individual therapy, etc.).
• Taxable base (price of the service without VAT).
• VAT rate (generally, exempt, as we will see below).
• VAT amount (if applicable).
• Total amount of the invoice.

VAT on Psychology Services

Generally, healthcare services provided by psychologists are exempt from VAT, provided they are aimed at the diagnosis, prevention or treatment of illnesses. It is important that you consult a tax advisor to confirm whether your services meet the requirements for VAT exemption.

Invoicing Software for Psychologists

There are numerous invoicing programs specifically designed for self-employed workers, which will make it easier for you to issue invoices and keep track of your income and expenses. Some of these programs offer additional features, such as appointment management and report generation.

Additional Tips for Self-Employed Psychologists

• Keep a thorough record of your income and expenses: This will make it easier to prepare tax returns and help you make informed decisions about your business.
• Take out professional liability insurance: This insurance will protect you in case of claims for errors or omissions in your professional activity.
• Invest in your continuing education: Stay up to date on the latest trends and advances in the field of psychology.
• Create a website and use social media: Promote your services and attract new patients.
• Seek professional advice: A tax and labor advisor will help you comply with your tax and administrative obligations.