What Expenses Are Deductible for the Self-Employed? Key Tips to Avoid Overpaying Taxes

One of the most important aspects for any self-employed professional is knowing which expenses can legally be deducted in the course of their economic activity. Applying these deductions correctly helps reduce the personal income tax (IRPF) taxable base and, therefore, pay less tax. However, not all expenses incurred by the self-employed are deductible, and the Spanish Tax Agency is increasingly strict in its criteria.

For an expense to be considered deductible, it must meet three essential requirements:

• It must be directly related to the economic activity.
• It must be supported by an invoice (simple receipts are not valid).
• It must be recorded in the self-employed worker’s accounting records.

If any of these three conditions are not met, the expense may be rejected in the event of a tax inspection.

Typical Deductible Expenses

Some common examples include:

• Rent of business premises or office.
• Utilities such as electricity, water, internet or phone.
• Purchase of IT equipment or office supplies.
• Subscription fees for invoicing software or tax consultancy.
• Professional training (accounting, tax, digital tools, etc.).

What About Health Insurance?

The law allows the deduction of up to €500 per year for the self-employed worker’s health insurance, as well as that of their spouse and each child under 25 living at home.

Example: if you pay €450 for your own insurance and €400 for your daughter’s, both amounts would be deductible.

Using Your Home as an Office

You can deduct a proportional part of the utilities (electricity, water, internet) if:

• You have informed the Tax Agency of the home office use (form 036 or 037).
• The general rule: you can deduct 30% of the percentage of the home used as an office.

Example: if you use 10% of your home as a workspace, you can only deduct 3% of the utilities.

What About the Car?

If the vehicle is used for both personal and professional purposes, it is not deductible under IRPF. It is only deductible in very specific cases: transport workers, salespeople, or couriers, where usage is 100% professional.

Other Deductible Expenses

• Self-employment contributions.
• Liability insurance.
• Advertising and marketing.
• Professional memberships or subscriptions.
• Meals away from home (if requirements are met):

Requirements: professional activity, electronic payment, and invoice. Limits: up to €26.67/day in Spain and €48.08/day abroad.

Do you have doubts about whether a specific expense is deductible? Want to make sure you’re applying all available deductions correctly?

Get in touch with us and we’ll review your case personally.

Optimising your taxes is in your hands… and in the hands of a good advisor.