Being self employed in Lanzarote, or any part of Spain is not only easy, but also much more common than in other European countries.
The Spanish word for self employment is Autónomo, when you register as autónomo you immediately start paying into the social security system and therefore receive entitlement to the local medical health system. The easiest way to set up your business is to work with an asesoría, they will make sure that the correct forms are completed and any necessary licenses required applied for. In some cases you will be required to charge IGIC, which is our equivalent to VAT, and in this case your asesoría will make a quarterly IGIC return on your behalf. The current rate of IGIC in the Lanzarote and the rest of the Canary islands is 5%.
When self employed you can opt to either make quarterly IGIC and income tax declarations or pay a fixed quarterly amount on the modulos system both have their advantages:
Quarterly declarations – the benefit is that you only pay tax on the actual income earned / declared but need to submit your invoices and receipts usually through an accountant.
Modulos system – simple, fixed cost and no book keeping but payable regardless of results.
As a self employed person in Lanzarote, you are free to earn your income from a number of sources, and it's quite common for people to have 3 or 4 "jobs" where they charge for their services by invoice. Be sure all the money you earn goes through your bank account, as this will help with getting finance in the future.
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