How a Spanish payslip works
A Spanish payslip (nómina) takes two kinds of deduction from gross pay. The first is the employee's Social Security contributions (cotizaciones a la Seguridad Social), charged on a contribution base that stops at a monthly ceiling. The second is the income tax withholding (retención del IRPF), a percentage of gross pay that the employer works out once for the year from the information you give it. The employer pays its own, much larger, contributions on top.
Many Spanish contracts pay fourteen times a year: twelve monthly payments and two extra payments (pagas extraordinarias), usually in summer and at Christmas. The calculator works on the annual gross, so the choice between twelve and fourteen payments does not change the result. Contributions treat the extra payments as spread over the year, which is how the contribution base is built, and the withholding rate is the same whichever month the money arrives.
The calculator follows the Agencia Tributaria's published withholding algorithm for the year shown and the contribution rates and bases set by that year's Social Security order. Its withholding figures were checked against the Agencia Tributaria's own calculation service.
The income tax withholding
At the start of the year, or when your circumstances change, the employer computes a single withholding rate from your expected annual pay and your personal data. The steps are fixed by regulation:
- Your Social Security contributions and a flat allowance for other expenses are taken off gross pay. Lower earners also get a reduction for work income, which fades out as pay rises.
- The personal and family minimum is worked out: an amount for yourself, higher from 65 and again from 75, plus an amount for each child or other descendant under 25 who lives with you, rising with each child, and an extra amount for each child under three.
- The withholding scale is applied to the reduced pay and, separately, to the minimum, and the second result is subtracted from the first.
- That amount divided by gross pay gives the rate, cut off at two decimals rather than rounded. The rate is then applied to every payment you receive.
Below an annual limit that depends on your family situation and number of children, nothing is withheld at all. Just above it, the amount withheld is capped at a share of the pay over the limit, so crossing the limit does not cost more than it pays. Contracts shorter than a year have a minimum rate, whatever the pay.
The withholding scale is the same everywhere in the common tax regime. The regional scales set by each autonomous community apply in the annual return, not in the payslip. The Basque Country and Navarre run their own tax systems with their own withholding tables and are not covered here.
Family situation and children
The data you give the employer on form Modelo 145 decide most of the result. There are three family situations:
- Situation 1: single, widowed, divorced or separated, with children under 18 who live only with you.
- Situation 2: married and not separated, with a spouse whose own income stays under the small annual limit printed on the form.
- Situation 3: every other case, including single people without children and married couples where both partners earn. It is also what the payer uses when you declare nothing.
Each child normally counts half, because both parents claim it. A child who lives only with you counts in full, which is always the case in situation 1 and which you can tick otherwise. More than two children also reduces the base the scale is applied to.
Social Security contributions
The employee pays for common contingencies (pensions, sickness and the rest of the general scheme), unemployment, vocational training and the intergenerational equity mechanism (MEI), each a rate on the contribution base. The base is your monthly pay with the extra payments prorated, capped at the maximum base. A fixed-term contract carries a higher unemployment rate than a permanent one.
Pay above the maximum base used to be free of contributions. It now carries the solidarity contribution (cotización adicional de solidaridad), charged in three tiers on the part of monthly pay above the ceiling and rising gradually over the coming years. Most of it falls on the employer.
A full-time employee always contributes on at least the minimum base for their professional group. The calculator uses the actual pay, which is right for part-time work, and warns you when the pay entered is below the minimum base for a full year.
What the employer pays on top
The employer section shows the employer's share of common contingencies, unemployment, vocational training and the MEI, the wage guarantee fund (FOGASA) and, above the ceiling, its share of the solidarity contribution. Together with the gross salary this is most of the cost of employing you. It leaves out the premium for occupational accidents and diseases, whose rate depends on the employer's activity, and any bonuses the employer receives for hiring particular groups.
What this calculator assumes
The result models an employee in the common tax regime with steady pay through the year. It does not cover:
- Disability of the employee or of family members, dependent parents and grandparents, geographical mobility, and court-ordered payments to a former spouse or for children.
- Residents of Ceuta, Melilla and La Palma, whose withholding is reduced, and employees in the Basque Country or Navarre.
- The voluntary higher rate an employee can ask for, the mortgage relief still available to some older home loans, and irregular income such as severance or multi-year bonuses.
- Contributions on overtime, in-kind pay and the employer's hiring bonuses, and the extra employer contribution due when a contract of under thirty days ends.
Withholding versus the annual return
The retención is an advance on the income tax settled in the annual return (declaración de la renta) the following spring. The return applies the scale of your autonomous community, regional and state deductions, joint filing if it suits your household, and the deduction that keeps minimum-wage earners free of tax, none of which the payslip sees. That is why someone on the minimum wage can have a little withheld and get it all back. Use this page to understand a payslip or compare offers, and the return for the final figure.