New freelancing beginnings in an empty Plaza Mayor

4 Important Things to Know Before Freelancing in Spain

A fresh start might be something you’ve been craving these past few months. Here’s a throwback to when Madrid got its own back in June 2020, after we came out of a strict lockdown.

Plaza Mayor de Madrid, June 2020.

So, you’ve just started freelancing in Spain or are planning to start very soon?

First of all, ¡enhorabuena!

I would love to be the one to tell you that the worst is over but…the truth is this: the next phase of your journey has just begun. I promise you that it will be worth it. Before you get there, though, you need to get started.

Second, and while I have to admit that experience is still the best (and toughest) teacher out there, I wish I had had someone to guide me through the tricky ins and outs of being self-employed in Spain way back in November 2017. The world was a very different place back then without AI, hybrid and remote work, cryptocurrency and other buzzwords that appear in hundreds of headlines across many corners of the Internet as we know it today.

If you have found my blog posts on student visa modification, renewing your TIE and getting registered as a freelancer helpful, you will surely find useful nuggets in a post dedicated to showing you how I work and manage my freelance business. Let me continue to be that person for you by first showing you some of the behind-the-scene stuff as well as the trials and errors that come along with working for yourself.

In this post, I’ll be giving you some of the best tips that I’ve gathered from doing this type of work after 6 years of freelancing in Spain.

As much as I love publishing helpful guides and sharing sage advice here, I cannot do any of this without financial support. There is no way to manage web hosting, the cost of owning my site’s domain, and the tools to help me keep up with everything without paying for it all out of my own pocket. It’s getting to the point where it’s not sustainable so I’m going to create some posts with freelancing tips you won’t find anywhere else. I hope to make my corner of the Internet a permanent resource for anyone who wants to enjoy Spain or build a life here.

I’m sharing the first four tips on the blog, but to access all of these carefully curated tips and hard-earned words of wisdom, I’m asking for a donation. however small, to help reduce the ever-increasing costs of running this website. You can do this by buying me a coffee (but we all know I really mean tea). Thanks again for your support. Remember, this would mean the world to small creators (and business owners) like me!

Let’s get started, shall we?

1. Get a tax advisor or accountant your first year

I can guarantee you that you will not be as happy as these Caga Tíos when it comes to finding an accountant or broaching the stress-inducing topic of taxes.

Barcelona, December 2014.

If you’ve ever talked to me about freelancing or consulted with me, you know I’m a big fan of keeping things simple. My thoughts and dreams are all pretty complex but how I work and write is all about simplicity. You may also be familiar with the KISS method (Keep it Simple Silly), which is a good place to start.

So, first things first, before you change your email signature, polish up your LinkedIn profile or work on your templates, ask yourself these questions one at a time:

  • How involved do you want to be in doing taxes and accounting for your business?
    • Possible answers:
    • Zero involvement, you think your life will be better if you are not informed about anything
    • Some involvement but you still need guidance via an as-needed or fully online service
    • 50% in the know, 50% letting a professional handle the rest
    • 100% involved (ie: you won’t sleep well at night unless you’re in the loop about everything)
  • Are you okay with not knowing the ins and outs of your tax responsibilities or do you need to know it all? If so, why?
  • Do you think your current level of involvement will change in the next year, 2 years, or 5 years?
  • Why or why not?
    • Does your Spanish need to improve?
    • Will you be taking a basic accounting or tax preparation course in the near future?)

Having spent a little over four years studying for a degree in Economics (which included macro and microeconomics, accounting, finance, business statistics, law and management to name a few), on paper, I already had some experience with what it takes to run a business.

In addition to my education, I had already achieved fluency in Spanish (14-15 years of studying and using the language at that specific point in time) coupled with previous experience freelancing in the US right out of college. I didn’t feel compelled to hire an accountant right away. In the beginning, and unless you’re starting your freelance business with a large chunk of savings, you’re not making a lot of money and the last thing you want is another expense (that’s either billed either monthly or quarterly).

Planning is the first
Ballycastle, Northern Ireland (UK), August 2023.

With all that being said, looking back on my time as a freelancer in Spain up to this point, it would’ve been helpful for me to have worked with a gestor for at least 6-12 months to really learn the why behind these tax filings and obligations. Or to benefit from some accountability and be forced to send in my invoices and payments by a specific date to help me build up the habit. Instead of doing what I have repeatedly done: waiting until the week or day before the deadline to gather up all my receipts and invoices and do all of the calculations before the filing window closes.

Shout out to the digital certificate for saving me countless times!

So, if you don’t have the best level of Spanish, want some accountability or need some help forming good habits around tax filing, get a gestor. It’s not a requirement for renewing your work permit but it could save you valuable time and money if that sort of thing isn’t your cup of tea.

Some additional tips

If you are going to rely on Spanish tax and accounting websites to help you file your quarterly tax forms, check out these websites for the best and most accurate information Infoautonomos, Declarando, GetQuipu and some SpaniGuru articles related to tax filing. As for the last suggestion, I’ve noticed that the quality of the site has gone down since late 2021, and not all of their posts are as well-written as they used to be.

For those of you who do want to be involved with the non-freelance work that comes along with owning your own business, here are some ideas to get you started on figuring out your own check-in schedule:

You might want to add a little more to your budget for cute sticky notes or notepads. I did this but got 50% off this dated planner from Mr. Wonderful this past summer.

Madrid, July 2023.

–Decide how often you want to take a look at your numbers (at least once a month but no more than 1-2 hours).

–You could also briefly review the financial side of things (income, expenses, pending bills, unpaid invoices and bills) every 5th day or something like that to help yourself stay organized.

–Another way to approach it is to schedule a couple of short 30-minute meetings with yourself -either at home or in a café, in a park, on a train, wherever you want to go!) twice a month to go over things. Yes, I am talking about putting these into your Google or Apple (or whichever calendar you use to schedule and attend these meetings. Think of it as keeping a promise you’ve made to yourself.

–Buy a generic, easy-to-write-on calendar and simply color code all of your quarterly and annual Hacienda filing due dates (and when Social Security payments will come out (ie: determining the last business day of the month).

When it comes to customization, there’s no real definite wrong answer as to how you want to get organized and set up your business. Make sure you and at least one other person can follow your filing system and/or read your handwriting!

2. Set up your own system for labeling invoices

Try not to let your workspace get as cluttered and messy as my suitcase just two weeks after I got married and while I was still apartment hunting.

Vallecas, Madrid, October 2019.

I read a lot of articles these days about productivity, organization and how to improve workflow. In addition to all my reading, I find tons of useful tips and advice in Facebook groups and from interacting with other freelancers and small business owners.

One thing in particular that I just learned this year is that you can customize everything. From different colored fonts in Google Docs and Notes to graphs and deciding what kinds of bullet points you like, the sky’s the limit. If you’re even remotely like me, a good list or pre-designed planning page is something that’s right up your alley. I’m still kicking myself for missing out on the opportunity to buy more than one 60-week planner from Hema when they shut down their operations in Spain for good in 2022. I’m glad I was able to grab one! I found it useful for a little over a year’s worth of work but the missed opportunity to always be that organized for a few years still haunts me today.

The good news is that you can always start over in any area you want at the beginning of a new year. Or if that’s not possible, you can do a little mini-reset for yourself next quarter.

You can’t do that with invoices, but if you’re just starting out, you’re in luck. You’re sitting in front of a blank canvas! The fact that you have this opportunity is a blessing but you may not see it from that angle right away in your freelance career.

The best thing you can do is not panic and focus on the things you can control. Start with getting yourself and how you want to organize your billing process. Here are a couple of ideas for different invoice labeling systems:

INV0001/001
INV001A/B/C (change the letter for each subsequent year you’re in business)

You should create invoices in more than one language if your client is located in another country where Spanish is not spoken. Many of you will do this, especially if you’re working in English.

3. Create or generate invoice templates in advance

While I can’t show actual snapshots of my own invoices for obvious privacy reasons, I can reiterate how important it is to have access to different copies of the same file or document. Whether you’re on a train, plane or traveling in a car, having them in the Cloud will save you tons of time.

Somewhere in the air, July 2023.

Anyway, it’s November 2023 at the time of writing this and while I’ve had some rough weeks regarding obstacles, the middle of the month was a very bad tech week. Several apps failed me including my invoice-generating app, which I may have brought upon myself.

To elaborate, if you know me, I don’t have a lot of free space on my phone due to my love of amateur photography and my inability to keep up with the latest technology. The storage space I’m working with these days is only 32GB with an additional 50 GB available in the Cloud. So when my invoicing app wouldn’t download again, it was kind of the last straw for me. Not to mention it was also hard to keep my frustrations in check.

Fortunately, I was able to rely on another invoice format that I had created in a Word document for a particular client last month. Clients sometimes send their preferred invoice template for guidance. In my experience, the formatting tends to take much longer to adjust than the actual work does so keep that in mind.

Save yourself hours of time –something I and many other experienced freelancers wish we could get back!

4. Open a business bank account

There’s a high chance you’ll be dealing with currencies other than the euro if you have international clients.

Northern Ireland, August 2023.

This item on the list is probably one of the hardest things to accomplish and you may be at the point where you are sick of the paperwork, bureaucracy and slow turnaround times. Believe me, I have been there and I still deal with something on an annual basis that makes me want to tear my hair out even to this day so don’t lose heart.

I had always heard that it is good to separate your business income and expenses from your personal expenses. The problem is that if you are living in Spain on a temporary residence permit is that you may have to wait a while to get your ID card (which may expire shortly thereafter). In addition, if you are a non-EU citizen, especially a US citizen, Spanish banks may make you jump through some extra bureaucratic hoops by providing them proof of a valid TIE annually and so they can update their records. Don’t forget the Foreign Account Tax Compliance Act (FACTA) form you’ll have to file annually or they might freeze your bank account and stop all transfers going in and out of it.

If only things could be easier, right?

I have been with the Galician-based bank ABANCA for almost a decade and I am very pleased with their service and products. If you want to learn more about banking, check out my complete guide.

Madrid 2019.

A bunch of other freelancers that I’ve talked to or even just interacted with online always give glowing reviews about OpenBank (a subsidiary of Grupo Santander). In fact, I’m on the cusp of opening an account with them myself because of the lack of fees and positive user experience.

However, since we’re approaching the end of 2023, I will wait and open the account after the new year. I’m thinking ahead and don’t want to put this on the plate of near-future-me come this holiday season. I just know that this time next December I won’t want to have to deal with reviewing any new terms or requirements that I need to meet. I usually have a clearer, more optimistic head on my shoulders come January – even if my accounts are lower than before the holidays – so I’d rather go into a new account with that mindset.

If you want to access the rest of this post full of more valuable tips, I would love for you to become a supporter on Buy Me a Coffee. You will have instant access to all of the posts I publish there. As you may know, it’s not free to host my domain or keep a website running year after year and I can’t express my gratitude enough for allowing me to continue to host it and help people just like you. I will be creating a few special posts for freelancers in Spain in the next few months over there so you won’t want to miss out! Freelance and remote workers in other parts of the world can also adapt these posts to fit their schedules and lifestyles.

Be sure to check out some of my other posts related to freelancing in Spain. Thank you again for your support and for sharing this site!

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