The calendar of the 2019 Income Statement continues its course despite the circumstances.

In fact, some freelancers see in this campaign, which taxes last year’s returns, an opportunity to obtain a pinch of liquidity at a time of zero or very low income. Whether you are one of the self-employed workers who anticipates a result in their favor in the 2019 Income Tax, or those who believe that they will have to pay the Treasury, you need to know what options you have to obtain the best result. Here is a decalogue for income savings 2019.

We start from the fact that this year’s campaign does not present remarkable innovations to reduce the taxpayer’s tax bill. Therefore, the options to curb the effects of the coronavirus go through applying the current deductions in Income for the year 2018.

Among the deductions for the self-employed in the 2019 Income are those of the expenses attached to the economic activity but, in addition, the Personal Income Tax Law establishes a series of state deductions that can be applied by the group of taxpayers obliged to present the 2019 Income statement.

  1. Large family deduction
    Having a large family will not only increase the minimums for descendants under 25 years of age in the 2019 Income, but also a deduction for a large family is applied that is added to the personal and family minimums. This deduction amounts to 1,200 euros per year for large families in the normal category and 2,400 euros for large families in the special category.

So now you know, if you are self-employed with a large family, have your large family title handy and benefit from this tax advantage on your 2019 Income as long as you have not requested its advance payment in model 143 or if you are entitled to the deduction of 1,200 euros for single-parent families with two children.

  1. Childcare Expense Deduction
    One of the novelties of the 2018 Income Statement was the incorporation of the deduction of 1,000 euros for childcare expenses for self-employed mothers, or failing that, the person who has exclusive guardianship and custody, with children under the age of three years.
    This state deduction, which is added to the 1,200 euros deduction for working mothers, is automatically applied to the 2019 Income thanks to the actions of daycare centers through model 233, the informative return that children’s centers presented in January.
  2. Deduction for investment in habitual residence
    Did you buy your current home before January 1, 2013? In this case, you can benefit from the transitory regime of the deduction for investment in your habitual residence in the same terms as before that date.

If you are self-employed in this case, you can deduct a maximum of 9,040 euros per year from your 2019 Income, which represents 15% of the contribution.

This deduction applies both in the case of acquisition of habitual residence and rehabilitation.

  1. Deduction for housing rental
    In the same way that taxpayers who bought their home before the end of 2013 can apply the above deduction, holders of primary residence rental contracts dated before January 1, 2015 can also deduct 10.05% of the amounts paid in the tax period when the tax base is less than 24,107.20 euros per year.
  2. Deduction for contributions to pension plans
    If you are one of the self-employed providents who have a pension plan and have made contributions during the 2019 financial year, you can apply a 30% reduction of the sum of the net income from Economic activities and income from work received individually in the financial year that It is declared with a limit of 8,000 euros per year.
  3. Deduction for donations and affiliations to political parties
    Another of the 2019 Income savings options is the deduction in the full amount of donations, money or goods, to non-profit entities regulated by Law 49/2002 of December 23. The deduction is 75% of the amount not exceeding 150 euros or 30% if it exceeds that amount.

Given these deductions, it can be said that the Treasury rewards solidarity but also economic support resulting from political sympathies. In the case of affiliation fees to political parties, the deduction limit is 20% over a limit amount of 600 euros.

  1. Deduction for investment in newly created companies
    The shares or participations subscribed as of September 29, 2013 are also a reason for savings in Income 2019. If you have contributed to newly created companies you can deduct 30% of the amounts, with a maximum deduction base of 60,000 euros formed for the acquisition value of the shares or participations.
  2. Deduction of economic activity expenses
    In addition to all of the above, the Treasury allows the deduction of expenses derived from the economic activity carried out by the self-employed worker in direct estimation as long as they are duly accounted for and justified by invoice, generally but also with bank receipts and other types of supporting documents.

The Social Security fee for the self-employed, some municipal taxes, financial expenses, rents or personnel expenses are just some of the deductible expenses that will reduce the result of your 2019 Income Statement.

  1. Reduction due to start of economic activity
    In 2013, the deduction for the start of activity was approved, according to which the self-employed person who starts the activity may apply the 20% reduction of his positive income in the first year in which he has benefits and in the following year.

Therefore, if you have started your activity in 2019 but have not yet obtained benefits, do not worry, you will be able to apply this reduction in the future, specifically in the first year in which you do obtain benefits and in the following year.

  1. Regional deductions
    In addition to the state deductions, you should not lose sight of the regional deductions of the 17 regions. The Treasury provides official information for consulting regional deductions that range from deductions for expenses for the acquisition of textbooks and school supplies in Aragon, for renting a habitual residence for young people in Andalusia or for promoting self-employment for young people in the Community from Madrid.

The importance of advice to ensure savings in Income 2019
Knowing how to apply each and every one of the deductions and reductions in your 2019 Income is not an easy task. You have to collect various documentation, locate the boxes where the deductions apply and fill them in with the data collected to calculate the result of your return.

If you prefer to place your trust in expert advice that will take care of all this, you can count on our 2019 Income preparation and presentation service.

+34 952 900 320

Tax department:
Carmelo Morales
direct line: 951 907 150
Ana Diaz
direct line: 951 907 151
Daniel Ortigosa
direct line: 951 907 152