Social Security payments

I am working in Spain "legally" so my social security is being paid. I am also resident.

can anyone advise if this is automatically linked to my National Insurance donations I have made in UK before moving out here? I understand there is some kind of agreement between the 2 countries but don´t know if I need to do anything in order for them to be linked.

Any advice greatly received. Thank you. 

Hi Raquel

I also pay social security here in Spain, and paid into the UK system for about 10 years.  But I´m not sure what you mean when you refer to "linking".  In what way linked?

Is it not your NI payments that enable you to an Old age pension, and here in Spain its the Social Security? So the more years, and more contributions you make the better your entitlement?

Possibly I am a little confused on this, but it was someone else who pointed it out to me and told me to make sure they are linked, so you don´t only get a pension based on one or the other. Help! I am very ignorant when it comes to these sort of things.

Hi, I don't know the answer to this question, but would be interested to know the answer!

Let me know if you find out, my children are thinking of living/working in Spain.

Regards,

Fibby,

I've copied some info from another web site forum but on the face of it it makes a lot of sense. If you are a resident in Spain and at a working age the minimum NI payment is 240 euros a month per person. (Sounds steep but DSS benefits are generally higher in Spain?)

The Spanish social security system is much like the British one, in that you pay your contributions every month, and that entitles you to a pension, unemployment benefit, sick pay, maternity pay and the right to receive free healthcare. The amount of pension or benefit you receive depends on the level of contributions you have been paying. You should be a little careful too: some small businesses pay all their staff cash in hand and those staff will not be eligible for Social Security benefits, including health care. Other employers may register you, but claim you are working less than you are, thus saving themselves some money in contributions. In this situation you will still be eligible for health care, but if you become unemployed or have to take sick leave, your benefits will be lower. Obviously you may not have much of a choice as to who you work for, but we would strongly recommend that you do not work cash-in-hand.

If you are self-employed you will have to go to the local Social Security office and fill in all the paper-work yourself. Unless your Spanish is very good, then it is probably advisable to get a gestor (official agent - a bit like a lawyer for menial bureaucracy) to do this for you. The minimum monthly contribution for the self employed in Spain is currently 225EUR per month.

If you have been employed in Spain for 6 months and you lose your job, you will generally be entitled to Spanish unemployment benefit. If you are employed or self-employed, you will also be entitled to sick pay, maternity pay and, when you retire, a pension. All benefits are paid at variable rates depending on the level of your contributions. If you have been paying minimum social security contributions the amount you will receive in benefits is currently around 750 EUR per month. If you are planning to live in Spain long term you should contact the DSS overseas department (above) in order to get your UK NI contributions transferred to the Spanish system.

Mike,

Excellent information thank you!

Kind regards,

Pat,

With my track record of accidents, I think I should invest in a Private Hospital not property! Do you know of any Hospitals going cheap?

Thanks Mike thats a great help.

Hi

I don't know whether anybody can answer this query for me.  I have looked at various websites, including the Spanish Social Security one (in English!) but nothing seems to cover this.  When we move to Spain in 2009, my partner John will be 65 and I will be 61. We will be receiving pensions from the UK, both State pensions and company pensions (one of mine will be from the civil service and the rest are private ones - sadly, none of them will pay out that much money!)  So far, this is fairly straightforward and I can find plenty of advice on-line.  The complication is, that I am a complementary therapist and hope to work on a self-employed basis, not only for the money (though that will help supplement my small pensions), but because I enjoy doing this.  I have been told that if I declare officially that I intend working on a self-employed basis , I will have to pay over 200 euros per month for social security, whether or not I earn anything.  Now I won't be claiming any benefits from the Spanish social security system, as I am relying on my UK pension, so I am assuming that I will be exempt, however it looks as if self-employed people are only exempt if they are over 65 (the retirement age for women as well as men in Spain).  Does anybody know whether I can claim exemption at the age of 61 on the basis that I won't have a Spanish pension or be claiming any other benefits from the Spanish social security system?

Thanks.

Sue

Hi Suemac,

Infortunately, you appear to fall into the Spanish NIC trap!

The answer is simple really. The retirement age for women in spain as you know is 65. If you intend to work as a self employed person you will need to pay the NIC rates applicable to your earnings just as anyone "under" the retirement age in the UK would have to!

I'm not aware of any lower NIC rates for the self employed to date! Perhaps other members would be better informed than me?

Hi

I have been paying NI for 23 years in the UK so it's good to know that it can be linked to the Spanish system. Just a few more questions which I hope someone can answer for me.

Would I get a pension from the UK and Spain? Or is it all put toogether?

I've heard you need to be paying for a minimum of 15 years into the Spanish system to receive a pension - is this true? My partner will be starting work there a couple of month after his 50th birthday so would he lose out or just not claim until a couple of months after his 65th? What happens to all the NI he has paid into the UK system - 34 years worth?

I was told at my job interview that I would pay about 6% of my gross wages into SS - this is at least half of the 200+ euros that someone said was the minimum. So how does that work? Will my employers be paying the rest?

When you are an employee in either the UK or Spain both the Employer and Employee will pay a proportion of National Insurance.

If you move to Spain and take up residency, you can elect to transfer you UK paid contributions into the Spanish system. You would need to obtain professional advice both in the Uk and in Spain to consider what may the best option for you?

Thank you miket. I was also paying into a private pension from 1992 to 1999. And a final salary pension since 1999. I will phone both companies and tax office here to find out what I need to do. Just waiting to see if I've got the job before doing anything official.

Can my partner carry on paying into his UK private pension when working amnd residing in Spain?

Hi Helen,

There is no problem with your partner continuing with his personal pension contributions in the UK but there would be an issue with any tax relief claimed has he could only claim tax relief on any installments against income earned in the UK?

He could choose to cease paying into his UK Pension scheme then claim his pension at the end of the terms agreed or I'm pretty sure he could transfer the value into a Spanish pension plan claiming tax relief through the Spanish Tax system? However, A word of caution; Take good care to find an honest financial services advisor in Spain who is properly licenced as they would have to be in the UK with the FSA. I'm sure there will be many better members of EOS who would have real experience of these issues than myself!