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Last year we published information on how to send invoices without registering as Autonomo.
Since earlier this summer, these invoicing cooperatives are under investigation, no doubt because of their success, resulting in less Autonomo contributions finding their way to the Government. To clarify: it´s not just the lower amount of social security contributions, but members are also free to choose the percentage of income tax retentions to withhold by the Cooperative on every invoice they send out in their name. Many will choose the lowest possible percentage (2%) instead of the fixed and in practically all cases higher IRPF retention percentage clients would be obliged to withhold and pay out to Hacienda on every invoice received from a regular Autonomo. If their work as invoiced through the Coop is indeed incidental and also below income tax threshold, they would be entitled to do so, as they would receive a refund when doing their RENTA declaration anyway. Several of the invoicing cooperatives have been denounced by the Association of Autonomos as according to them, all members should in fact be registered as Autonomos and paying full contributions.
There has been a ruling by the courts on FACTOO, one of the biggest invoicing coops, based in Valencia, that orders them to close shop and dissolve the cooperative, but the management has announced that their legal council sees many options open to appeal and meanwhile, they will continue to assist their members as usual.
UPDATE 17.4.2018 FACTOO has filed a complaint with the European Court and has asked them to check on the legality of the ruling of the Spanish courts, as to the best of their, and their lawyers´ knowledge, it goes against European Regulations. They quote the case of a similar cooperative in Belgium, with over 50.000 members whose legality is not in doubt whatsoever.
Another cooperative, not under investigation as yet, Cooperativa Online, has decided to shut down all activity and dissolve as per yesterday, the 22nd of August. Members can solicit a return of their ´socio capital´ by sending an email. All members/socios have been notified by email.
In view of these recent developments CAB Spain considers it prudent to advise members to abstain from registering as member of an invoicing cooperative at the moment and rather wait until the FACTOO appeal has had its ruling in court and the legality of these invoicing cooperatives can be confirmed.
Update January 2019. Mid December last year, FACTOO has gone into liquidation. The process, filing for liquidation was started earlier last year when a report by the Inspección de Trabajo was published finding the cooperative not in compliance with the rules and regulations for such organisations and a debt with the Tax Agency for a million euros was established. According to the information provided to members, outstanding invoices will be paid out, but with a delay as a complete list of debtors needs to be approved by the accountants first. At this time it´s not sure that socios will be able to claim back the money they put in when they joined. Needless to say that the cooperative is not taking on new members, but others are still fully operational.
