ENGLISH VERSION (1 Apr) / Update on extraordinary measures in Spain due to the coronavirus crisis for self-employed workers and companies

extraordinary-measures-in-spain-due-to-the-coronavirus-crisis-for-self-employed-and-companies

Today (Wed 1 Apr 2020) new measures have been published addressing the Coronavirus crisis which are in part new in part amend the measures that had been adopted in the past weeks.

We will describe below the measures that we consider most relevant as well as outlining how the measures adopted during the State of Alarm will look once the further new measures have been implemented, as of tomorrow.

  • Self-employed workers who had to close their businesses or whose turnover has decreased by 75% with respect to the average of the turnover of the last 6 months may apply for the “prestación por cese de actividad (aid due to close of business). Even if the Decree does not expressly make any reference to it, we believe that the provision applies also to self-employed who are directors of a company (autónomo socitario).
  • Both companies and self-employed people with employees whose activity have decreased or who had to suspend their activities may submit ERTEs (procedure for the temporary regulation of employment relationships). This measure does not apply to companies which had to suspend their activities from 31st of March and which can apply to their employees the measure called “permiso retribuido recuperable” (recoverable paid leave).
  • All companies that continued functioning after the State of Alarm was first initiated have been obliged to cease their activity from the 31st of March. In light of the ambiguous draft of the Decree on the possibility for some workers to maintain their activity the Minister of Economy during Monday’s press conference, stated that companies can keep part of its workers active on those aspects of the business which will facilitate the total reactivation of the production processes, as long as the company provides to its workers a document outlining the need of their functions.
  • ICO will extend its budget to finance the self-employed and companies and there will be new lines of guarantees by the Government to obtain loans by credit entities.
  • All administrative proceedings are suspended until the State of Alarm ends. Fiscal proceedings are suspended until the 30th of April or 20th of May depending on the type of proceedings.
  • The fiscal calendar is kept as such as far as it concerns tax payments. The date of payment of the amounts to pay for any categories of taxes can be postponed for three months without any interest, and three additional months with interest.
  • As far as mortgage loans are concerned, please note that the moratorium granted for the main residence now is extended to any real estate properties intended for economic activities as well as to second residences that were rented and for which rental is no longer gained. Moreover the moratorium is extended to the majority of loans (both mortgage or not) and its execution is limited also with regards to guarantors or guaranteeing parties so they do not see themselves prejudiced by these measures.
  • Social aids for the main facilities in the main residence are now extended to self-employed whose activities had to stop.
  • A moratorium for the payments of quotas for self-employed workers and social security quotas for employees of both self-employed people and companies for a period of 6 months is granted. For the quotas of the self-employed, the moratorium will be for the instalments to be paid from May until July and for the social security of employees it will apply for the months of April until June 2020. The rule also adds “ as long as the activities have not been suspended because of the State of Alarm”. We understand that those who have applied for the ERTE or for the “cese de actividad” cannot apply for the moratorium. In any case we are waiting for the publication of a Ministerial Decree which will explain the details and the relevant procedure.
  • Self-employed people who have applied for “cese de actividad” will be allowed to reject the request for payment of their quota for March (this is not stated literally in the text of the rule but our aim is to make it easy for the reader). The Administration will not apply any additional charge for the failure to pay but it doesn’t say anything about interest for delay (we believe interest will apply) and we also understand that when in the future the administration will ask for it, the payment of March quotas must be made.
  • In case you have debts with Social Security with deadlines for payment between the months of April and June 2020, you can ask for their postponement with an interest of 0.5%.
  • Self-employed people and companies may modify or suspend their utilities contracts (gas and electricity) to adapt them to their consumption needs without being penalized by the suppliers as well as suspend the payment of invoices corresponding to the months of the State of Alarm.
  • Everything established so far regarding the postponement of payments of taxes or loans, which was initially referred to the Central Administration, now also applies to the autonomous and local administrations.
  • Debts and duties relating to customs can also be postponed as long as they refer to the period between the 14th of March (the entry into force of the State of Alarm) until the 30th of May.
  • Terms for holding meetings of Board of Directors of companies for the approval of annual financial statements are postponed as well. The same applies to the submission of the annual financial statements to the Companies’ Register (our clients already know that they should not worry about this procedure because we are taking care of it on their behalf). There are also special provisions regarding the application of the financial result.
  • With regard to subventions and State aids, in any phase of its requests, orders or granting, the terms for their execution will be postponed.
  •  Court activity is suspended. It’s not even possible to submit any writs except for urgent matters as defined by the Ministry of Justice, the Consejo General de Poder Judicial and the Consejerías de Justicia of the Autonomous Comunities (mainly criminal cases with people under detention or arrest, urgent measures in the field of family law, minors and disable persons, and violence against women).

Social Measures

Regarding those who rent their main residence the measures provide:

  • Eviction procedures for failure to pay ( those that were initiated after the State of Alarm began) will be suspended in case of people considered in a situation of vulnerability, until a report from social services is issued and until October 2020.
  • Compulsory Moratorium or cancellation of the rent if the landlord is a public company or a private company or falls within the so called category of “gran tenedor de inmuebles” (a landlord owning a significant number of real estate properties). If the landlord is a small-owner, he/she is not obliged to grant the moratorium or cancellation of the debt asked by the lessee, who has to make use of the Government’s lines of credit.

Housekeepers who had to stop working for any reasons (for health precaution, due to being fired, for waiver or suspension of the activity) can apply for a specific subsidy.

For consumers entered into purchase contracts of product or services and in case such transactions have been affected by the State of Alarm, depending on the type of transactions, will have the right to obtain a coupon to allow for new transactions to take place in the future or can obtain the reimbursement of the amount paid.

There is also the possibility to obtain payments from retirement plans by unemployed persons or self-employed people who stopped their activities for the amount considered necessary to satisfy their basic needs and this until September 2020.

The Comunidad de Madrid approved a subsidy for self-employed people

The Comunidad de Madrid approved a subsidy for self-employed people, for the payment of the of the social security quota. The term to apply for it is, at least, 3 months after its publication. On the basis of the features of this subsidy we recommend to apply for it after the 1st of June.
This is a summary of the measures currently in force and the relating amendments.
Should you need additional details regarding any of them, please feel free to contact us.

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