The Four Most Common Tax Errors Of The Self-Employed


The self-employed are a fundamental pillar of the Spanish economy. With more than three million self-employed workers, they constitute one of the essential elements of the business fabric of our country and, at the same time, the main engine of productive activity.

However, many of them make tax errors that can be expensive, at least in the eyes of the Treasury. In this article, we will talk about the four most common tax mistakes made by the self-employed in Spain and how to avoid them to avoid problems with the Tax Agency.

The Most Common Mistakes Of The Self-Employed With The Tax Agency

Unlike salaried workers, the self-employed must file their taxes themselves. In most cases, they resort to the services of specialized agencies, but sometimes they do it themselves, which can lead to errors that, in the long term, can be very expensive.

Even though, in many cases, they are simple procedures, carelessness, the omission of information, and also, the picaresque has caused many self-employed workers to be exposed to economic fines for not doing things correctly before the Treasury.

Next, we expose some of the most common mistakes the self-employed make with the Treasury so that you try to avoid them if the problem arises.

Not Keeping Your Accounting Up To Date

One of the most common mistakes that the self-employed in Spain make is not keeping good accounting. The accounting record is an obligation for the self-employed, but, at the same time, it is the basis on which the presentation of the main taxes is governed, especially the IRPF (through the income statement) and the quarterly VAT.

It is essential to keep an exhaustive control of income and expenses to present all tax returns correctly and thus avoid possible penalties from the Treasury. In addition, good accounting will give you a clear vision of the financial situation of your business and help you make informed decisions.

To keep good accounting, it is advisable to use a billing and accounting program to automate the management of your income and expenses. Otherwise, you run the risk that the information is not correctly updated and that it does not adjust to the reality of the activity. It is also important to save and record all invoices and purchase receipts to justify the expenses before the Tax Agency.

Not Reporting All Income.

Another common mistake is not declaring all the income, thinking that the Tax Agency will not find out about the fraud. It is important to remember that you must inform the tax office of all the income you obtain from your business activity, whether it is from the sale of products or the provision of services. Omission of income may be considered tax fraud and subject to fines and penalties.

It is advisable to keep a record of all invoices issued and received. Remember that income must be declared in the quarter it was received, regardless of whether it has been collected, especially if the accrual criterion is used.

In some cases, the draft of the income statement does not include all the income obtained by the taxpayer, and they may be tempted not to include the rest. But this is a mistake because the Treasury will most likely detect fraud, especially in such a digitized age as we are, where crossing data is easy and fast.

Not Correctly Deducting Expenses

Deducting expenses correctly is a fundamental aspect for the taxpayer since it allows them to reduce their tax base and pay less. However, many freelancers make the mistake of deducting expenses that are not deductible or of not correctly justifying the actual expenses.

It is important to bear in mind that only expenses that are directly related to economic activity and that have been justified with an invoice or receipt are deductible. In addition, in some cases, it is advisable to consult a specialized tax advisor since not all the expenses related to the activity can be considered deductible or, at least, not in their entirety.

It is also necessary to consider the specific limits and requirements for certain expenses, such as food or vehicle expenses. But, of course, it is important not to include any expense as a deductible or related to the activity since this constitutes fraud that can lead to sanctions and surcharges before the Treasury.

Not Complying With All Tax Obligations

The last common mistake is not complying with every one of the tax obligations. In general, the self-employed must submit quarterly VAT returns through model 303 and personal income tax withholdings, as well as the annual income statement and corporate tax, if applicable.

In addition, in many cases, it is important to present other models, such as model 720 in case you have assets abroad, or model 115, to declare income or returns from the lease or sublease of urban real estate. And also comply with regional obligations.

Failure to comply with these tax obligations can have serious consequences, such as fines and even the temporary suspension of economic activity. Therefore, knowing your tax obligations well and complying with them on time is important.


In short, the self-employed must pay special attention to the fiscal management of their business to avoid the most common mistakes and the consequences they can cause. Keeping good accounting, declaring all income, correctly deducting expenses, and complying with tax obligations are key aspects of efficient tax management.

Also Read: Always keep An Eye On The Costs When Trading

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