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Some travel and equipment expenses must be supported by a tax invoice issued in the employer’s name, which employees can confirm from their employment agreement. Approved expenses within the stated limits are not taxable, but any reimbursement without the required documentation will be treated as taxable. Car leasing cannot be treated as a benefit in kind because the lease cannot be held in the employer-of-record’s name.
Employment in Spain
Minimum wage
EUR 16,576
Employer costs
32.17%
Employee contribution
6.48–6.53%
Employee tax
18–45%
In Spain, the statutory minimum wage is EUR 16576 per year. Employers typically face social security contributions around 32.17% of salary, while employees contribute a combined headline rate of about 6.48–6.53% for items such as common contingencies, unemployment, professional training, and the MEI surcharge. Personal income tax is progressive, with headline rates ranging from 18–45%, and is withheld through payroll. These elements together shape the overall cost of employment and net take-home pay for employees.
Onboarding time
We can help you get a new employee started in Spain fast. The minimum onboarding time we need is only 48 hours. Our team ensures fast, compliant employee onboarding and payroll processing. The onboarding timeline starts once the employee submits all required information via the NEO platform.
Payroll
Spain’s payroll system includes separate social security contributions for employers and employees, with multiple components applying under specific conditions. The overall employer burden is significantly higher than the employee share, and none of the main contribution rates are flat across all situations.
Employer social security components
| Component | Rate |
|---|---|
| Common contingencies | 23.6% |
| Unemployment | 5.5% |
| Professional training | 0.6% |
| Wage guarantee | 0.2% |
| MEI | 0.67% |
Employee social security components
| Component | Rate |
|---|---|
| Common contingencies | 4.7% |
| Unemployment | 1.55% |
| Professional training | 0.1% |
| MEI | 0.13% |
Minimum wages
Statutory minimum wage (annual)
EUR 16576
Working hours
Standard working time in Spain is based on a full-time schedule spread across Monday to Friday. Employers should ensure contracts and scheduling practices reflect these norms unless a different arrangement is clearly agreed.
Standard full-time hours
40 hours per week, Monday to Friday
Leave
Spain distinguishes between paid annual leave and sick leave, each with its own accrual or documentation rules. Employers should align internal policies with these minimum standards while checking any applicable collective bargaining agreement for enhancements.
Leave policies
| Leave type | Key rules |
|---|---|
| Annual leave | 22 days per year of paid time off; unused days cannot be carried over |
| Sick leave | Medical certificate required from the first day of absence |
Public holidays
Spain observes a set of nationwide public holidays each year, in addition to regional and local holidays that may apply depending on where the employee works. Below are the confirmed national holidays for 2026.
Spain public holidays 2026
| Date | Holiday |
|---|---|
| 2026-01-01 | New Year's Day |
| 2026-01-06 | Epiphany |
| 2026-04-03 | Good Friday |
| 2026-05-01 | Labor Day |
| 2026-08-15 | Assumption Day |
| 2026-10-12 | National Day |
| 2026-12-08 | Immaculate Conception |
| 2026-12-25 | Christmas Day |
Expenses
In Spain, expense reimbursements must meet specific submission deadlines to be included in the intended payroll cycle. Timing rules differ for current-year versus prior-year expenses, and late submissions can trigger gross-up treatment.
Payroll timing
| Item | Value |
|---|---|
| Payroll cut off date | 20th day of the month |
| Pay date | Last day of the month |
Expense submission windows
| Expense type | Action and deadline |
|---|---|
| Current year's expenses | Submit within 60 days of the expense date or 30 days after return from business travel, whichever is later |
| Prior year's expenses | Submit by February 1; after this date, a gross up will apply |
General expense rules
Communication and workspace
Phone and internet subscriptions are treated as taxable and reclassified as allowances, while coworking costs can be reimbursed tax-free when properly documented. Coworking invoices must clearly identify the employer and include full tax details.
Communication and workspace expenses
| Expense | Taxation |
|---|---|
| Phone subscription | Taxable; reclassified as an allowance |
| Internet subscription | Taxable; reclassified as an allowance |
| Coworking | Non taxable when supported by a tax invoice with date, amount, merchant, description, employer name and address, employer VAT ID, and VAT amount |
Equipment and supplies
Work tools such as laptops, office equipment, software, and basic supplies are generally reimbursable on a non taxable basis when supported by appropriate tax invoices or receipts. Invoices typically need to show the date, amount, merchant, description, and, for many items, the employer’s tax details or the employee’s name.
Equipment and supplies expenses
| Expense | Taxation |
|---|---|
| Laptop | Non taxable with a tax invoice including date, amount, merchant, description, employer name and address, employer VAT ID, and VAT amount |
| Office equipment | Non taxable with a tax invoice including date, amount, merchant, description, employer name and address, employer VAT ID, and VAT amount |
| Office supplies | Non taxable with a tax invoice or receipt including date, amount, merchant, description, and VAT amount |
| Software subscription | Non taxable with a tax invoice including date, amount, merchant, description, and employee name |
| Postal charges | Non taxable with a tax invoice or receipt including date, amount, merchant, description, and VAT amount |
Travel
Most business travel costs, and even some non-business travel when invoiced correctly to the employer, can be reimbursed tax-free. For many travel items, a tax invoice or equivalent proof must show the date, amount, merchant, description, VAT amount where applicable, and in some non-business cases the employer’s name, address, and VAT ID.
Travel expenses
| Expense | Taxation |
|---|---|
| Business travel insurance | Non taxable with a tax invoice including date, amount, merchant, description, and employee name |
| Visa fee | Non taxable with a tax invoice or receipt including date, amount, merchant, and description |
| Accommodation | Non taxable for business travel or for non-business travel supported by a tax invoice including date, amount, merchant, description, VAT amount, and employer name, address, and VAT ID |
| Flight (including luggage) | Non taxable for business travel or for non-business travel supported by a tax invoice, receipt, or booking confirmation with payment summary including date, amount, merchant, description, VAT amount, and, for non-business travel, employer name, address, and VAT ID |
| Taxi or rideshare | Non taxable with a tax invoice, receipt, or voucher including date, amount, and merchant |
| Train | Non taxable for business travel or for non-business travel supported by a tax invoice, receipt, train ticket, bank statement, or card slip including date, amount, merchant, description, VAT amount, and, for non-business travel, employer name, address, and VAT ID |
| Public transport | Non taxable with a tax invoice, receipt, or voucher including date, amount, merchant, and description |
| Car rental | Non taxable for business travel or for non-business travel supported by a tax invoice including date, amount, merchant, description, VAT amount, and employer name, address, and VAT ID |
| Fuel | Non taxable with a tax invoice, receipt, or voucher including date, amount, merchant, and description |
| Mileage | Non taxable reimbursement of EUR 0.26 per kilometer based on mileage calculator or GPS evidence of distance; amounts above this limit are taxable |
| Parking or toll fees | Non taxable with a tax invoice, receipt, or voucher including date, amount, merchant, and description |
Meals and entertainment
Everyday meals, groceries, and client entertainment can be reimbursed on a non taxable basis when supported by proper documentation. A tax invoice or receipt must show the date, amount, merchant, and a brief description of the purchase or service.
Meals and entertainment expenses
| Expense | Taxation |
|---|---|
| Breakfast, lunch and dinner | Non taxable with a tax invoice or receipt including date, amount, merchant, and description |
| Groceries | Non taxable with a tax invoice or receipt including date, amount, merchant, and description |
| Meal with client or partner | Non taxable with a tax invoice or receipt including date, amount, merchant, and description |
Other expenses
Training, courses, books, and promotional items can also be reimbursed tax-free when they are properly invoiced. For employee-focused learning, invoices should name the employee, while promotional items must clearly identify the employer and include full VAT details.
Other expenses
| Expense | Taxation |
|---|---|
| Training, courses, and books | Non taxable with a tax invoice including date, amount, merchant, description, and employee name |
| Promotional items | Non taxable with a tax invoice including date, amount, merchant, description, employer name and address, employer VAT ID, and VAT amount |
Screen eyewear
Under EU Directive 90/270/EEC, employers must reimburse protective eyewear and eye exams when required for screen work, provided the need is medically certified. These reimbursements are non taxable within the specified annual limit.
Screen eyewear expenses
| Expense | Taxation | Limit |
|---|---|---|
| Screen eyewear | Non taxable with receipt, tax invoice, or eye exam results including date, amount, merchant, medical certification of need, and eye exam results | EUR 200 per year |
| Eye exam | Non taxable with receipt or tax invoice including date, amount, and merchant | Included in the annual limit |
Per diem
Employers may offer non taxable per diems to cover living expenses such as meals and incidentals during business travel, excluding accommodation and transport. Employees must document their travel dates, destination, and business purpose, and upload supporting evidence such as flight tickets or hotel bookings.
Per diem requirements
| Requirement | Instructions |
|---|---|
| Dates of travel and destination | Employees must specify travel dates and destination and upload supporting documentation confirming the trip, such as flight tickets or hotel bookings |
Per diem rates
| Type of trip | Duration | Per diem rate |
|---|---|---|
| Domestic trip | Same day trip | EUR 26.67 |
| Domestic trip | Overnight stay | EUR 53.34 |
| International trip | Same day trip | EUR 48.08 |
| International trip | Overnight stay | EUR 91.35 |
Bonuses
Bonuses in Spain include both contractual and discretionary payments such as incentives and commissions. They are taxed as regular income, with applicable social security contributions and progressive withholding, so the tax withheld in periods with bonus payments may be higher than usual.
Allowances
Spain allows a mix of mandatory and discretionary allowances, with specific tax treatment when benefits are offered through flexible retribution programs. Allowances are generally taxable unless a non taxable limit is explicitly provided, and they cannot be grossed up to guarantee a net amount to employees.
A Work From Home Allowance is required for employees in Spain under the applicable collective bargaining agreement and is processed automatically through regular payroll.
| Type | Status | Taxation | Limitations |
|---|---|---|---|
| Work From Home Allowance | Mandatory | Taxable | EUR 50 per month, prorated based on days worked; must be offered to all employees in Spain as per the collective bargaining agreement |
| Transportation Allowance | Optional | Non taxable up to EUR 136/month and EUR 1,500/year when offered through a flexible retribution program | Must be offered through a flexible retribution allowance partner for tax favourable treatment |
| Meal Allowance | Optional | Non taxable up to EUR 220/month and EUR 2,420/year when offered through a flexible retribution partner | Must be offered through a flexible retribution allowance partner for tax favourable treatment |
| Childcare Allowance | Optional | Non taxable up to EUR 1,000/year in Álava and Vizcaya y Guipúzcoa when offered through a flexible retribution allowance partner | Must be offered through a flexible retribution allowance partner for tax favorable treatment |
| LTI Programs (Shares and other compensations) | Optional | Fully taxable as income based on valuation in kind or as a monetary amount | Employer should share full details of the LTI arrangement and any tax withholdings done by the broker; may be offered at the employer’s discretion to one or more employees |
| Relocation | Optional | Taxable | May be offered at the employer’s discretion to one or more employees |
| Car Leasing | Optional | Taxable | May be offered at the employer’s discretion to one or more employees |
| Utilities | Optional | Taxable | May be offered at the employer’s discretion to one or more employees |
| Gym Membership | Optional | Taxable | May be offered at the employer’s discretion to one or more employees |
| Life Insurance | Optional | Taxable | May be offered at the employer’s discretion to one or more employees |
| Wellness | Optional | Taxable | May be offered at the employer’s discretion to one or more employees |
Termination
Termination practices in Spain must respect statutory notice and any agreed probationary periods. These rules set minimum frameworks that can be refined by contract or collective bargaining agreement.
Termination-related periods
| Policy | Key parameters |
|---|---|
| Initial notice period | At least 15 days’ notice after probation |
| Probation period | Up to 180 days, with no minimum notice required during probation |
