There’s been a lot of controversy in the news recently about the Infanta Cristina (Spanish royal family) claiming back salsa and merengue classes at the expense of Spanish taxpayers. So, as a freelance worker in Spain, when it came to claiming a course I’d done as a cost, I was naturally somewhat nervous.
Which expenses can freelance workers justify?
A call to the Hacienda (Spanish Inland Revenue) revealed the following:
1. No, I couldn’t claim back VAT, as the course I had studied was a language course, and language courses don’t pay VAT (actually, I’m not sure any kind of course pays VAT).
2. I could list it as an expense (and thus be susceptible to a lower IRPF rate, which, under the system I fall into, is paid in function of your profits), if and only if I could suitably justify the correlation between the expense and increased profits.
Let’s take a (real – it’s mine!) example of how you might do this.
Say you want to learn French. If you’re already earning something for services rendered in French, and speak relatively good French, it the expense of something like becoming an official translator, or a language perfection course, could credibly be justified. If you have things like letters from clients asking you to learn this skill, it will help your case. Above all, your earnings from using this skill should increase after having done the course.
If you’re in doubt, I’d play on the side of caution. However, this is something that’s worth looking into, as even if you can’t claim back VAT, showing a decreased level of profit could require you to pay less IRPF.
How do I claim expenses?
In the majority of cases, IRPF is calculated via Modelo 130 and the formidable end-of-year Declaración de la Renta. So to claim the expense, all you need to do is include these costs along with your other expenses on these forms (follow the links to see exactly how to do this).
Text and photos by Penelope
