6 steps to become a self-employed with employees

Are you considering taking a step forward in your freelance career? Being a self-employed with employees brings new challenges and opportunities that require careful planning and specific knowledge. Here, we will guide you through the steps to effectively transition into this entrepreneurial stage and ensure a prosperous future for your business!

How to hire personnel as a freelancer?

When you are self-employed, you may find yourself in situations where you need to hire someone to cover your requirements. Whether on a one-off or ongoing basis, freelancing with employees is becoming more and more common. 

In addition to this option, you can also collaborate with other freelancers through commercial agreements. Treating the other freelancer as a client and without establishing fixed working conditions and schedules. Below, we answer the main questions about hiring personnel: 

What steps must a self-employed with employees follow to carry out a hiring process?

Similar to any other company, a self-employed person can hire an employee under an employment contract. In this case, the self-employed person is responsible for paying the employee’s social security contributions. 

What is the cost associated with hiring personnel for a freelancer?

The expenses related to social security and salaries of an employee vary. It all depends on the agreement that applies to workers depending on the activity you perform. As well as the type of contract, whether temporary, indefinite, part-time, full time, among others.

As a reference, the estimated cost of hiring an employee in the general regime is usually around 30% of the base salary.

Is there a hiring limit for a self-employed with employees?

There is a limit on the number of employees hired for the self-employed who are taxed under the module regime. In these situations, the number of employees hired can range between 2 and 10 employees maximum. 

This being the case, everything will depend on the nature of the activity. For example, in the bread industry, a maximum of six employees is allowed. While in the retail trade, only a maximum of five employees is allowed.

Can a self-employed person employ a foreigner?

To become a freelancer with foreign employees, you must follow these steps:

• When they are EU foreigners, they may be hired as long as the employment is compatible with their current studies. This is the case if the worker is clearly studying or doing an internship. In this case, he/she will be granted a work authorization with a maximum duration of three months.
• They also authorize employment for persons who have completed their studies and have resided in Spain for more than 3 years. As long as they have not been granted a scholarship by Public Agencies. Those who have resided in Spain continuously for one year on a regular basis may also be authorized.
• In the case of non-EU foreigners, they can also obtain a work permit. As long as their stay in Spain is not irregular.
• Foreigners who find employment must present, together with the work permit: the employment contract, a criminal record certificate and a medical certificate certifying their good health. These documents are necessary to obtain the new work permit.

You may also be interested in: How to become self-employed in Spain if you are a foreigner?

6 steps to become a self-employed with employees in Spain

When a freelancer decides to hire a worker, it is necessary to follow a series of important steps:

You may also be interested in: Is it possible to hire personnel as a freelancer in Spain?

How does the hiring of workers affect your self-employment bonuses?

It is essential to know that being self-employed with employees has no negative impact on this aspect. Since October 2015, you have been entitled to receive various bonuses as a self-employed worker. This set of advantages includes significant benefits, such as the flat rate when you start your entrepreneurial activity.

In exploring the costs associated with having an employee under your registry, it is important to analyze three essential elements:

1. The employee’s gross salary. After deductions and withholdings, it becomes the net salary. This is the amount that the worker receives punctually at the end of each working month.
2. Expenses related to social security contributions. These fall on the employer company and are calculated according to coefficients pre-established by the Social Security General Treasury.
3. Additionally, it is prudent to consider the valuable resource of an expert consultancy. One that takes care of drawing up contracts, generating payrolls and managing social security requirements efficiently. In this way you alleviate the administrative burden and optimize the process as a self-employed with employeess. 

What legal steps are necessary to hire workers?

Once you have completed the administrative processes mentioned above, you will be officially prepared to carry out the various legal procedures for hiring workers. 

In this sense, you will be able to establish a contractual relationship with those who join your business. So, in order to do so, you must:

• Register registrations, cancellations and changes in the data of the workers you wish to employ in your company.
• It is essential to note that current legislation requires reporting these human resources movements through the TA.1 and TA.2/S forms, respectively. These records must now be made electronically.
• As a self-employed with employees you must file and register the labor contracts with the State Public Employment Service (Servicio Público de Empleo Estatal). This process must be completed within a maximum period of 10 days from the signing of the contract between both parties.

How does the payment of social security contributions work?

During the labor relationship with your employees, it will be essential to be up to date with the contribution fees. Those of the General Treasury of the Social Security. These contributions must also be explicitly reflected in the employees’ pay slips.

Remember to carry out these procedures through the ‘RED Directo’ platform. This is both for a self-employed person with employees and any company with less than 15 workers. The platform facilitates other labor procedures, such as notifying medical leave and declaring temporary disability of workers.

You may also be interested in: Flexible compensation: definition and benefits

Becoming a self-employed with employees is an important and exciting step in growing your business. Whether you are considering hiring your first employee or expanding your team, it is essential to have the right information. 

We are here to support you every step of the way. Providing you with the tools you need to make this transition a success, get started today and build your successful network as a freelancer with employees! Contact us at tasconsultoria@tas-sl.es.