Salaries in Spain

03/05/2024.- Compared to other European countries (like France or Germany), salaries in Spain rank fairly low. Yearly salaries in Spain are similar to salaries in Italy and Slovenia, but still remain far from those registered in northern European countries. That said, a distinction must be made between minimum wage on one hand, and the average salary in Spain, on the other.

Minimum salaries in Spain

The minimum wage (SMI, or Salario Mínimo Interprofesional) applies to all workers regardless of their age (including minors at least 16 years old), gender, or type of contract. It is for the Spanish government to adjust the minimum wage each year based on a variety of factors, including national productivity and employment levels. The Ministry of Employment and Social Security sets the minimum wage in Spain at daily, monthly, and annual levels.

As of 2024, the minimum salary in Spain is €1,323 per month for a full-time employee (ie 40 hours a week). For those receiving wages over 14 payments, the minimum monthly salary amounts to €1,134, with two additional payments in July and December. This totals to an annual income of €15,876.

The minimum wage per hour is €8.87.

That said, attention must be drawn to the fact that many industries and sectors in Spain operate collective agreements. These cover minimum wages and workers’ rights within either a group of companies or the industry as a whole. If the employment relationship falls under a collective agreement, the minimum salary could be higher. Our team of payroll experts will inform you about the relevant collective agreement to be applied in your particular case.

When an employee is not earning at least the minimum wage in Spain he/she can complain to the Labor Inspectorate, who will assess your case. The Spanish authorities can fine employers who fail to adhere to Spain’s minimum wage regulations.

Average salary in Spain

In 2004, the average gross salary in Spain is €2,250 per month or €27,000 per year. This represents the average, but salaries in Spain may differ depending on where you live. For example, if you live in Barcelona or Madrid you will pay much more for renting or buying a home than in smaller, less expensive towns. Therefore, average salaries in Spain when talking about big cities may be much higher than the above referred figures.

Number of payments

Employers in Spain are obliged to pay their employees in 12 monthly instalments. In most collective agreements there are also two extra payments, usually in July and December, which are normally prorated and included in the monthly paychecks through social security contributions.

Other agreements may even establish the payment of three extra payments or that the payments cannot be prorated in the payroll, and must be paid in the months of March, July, and December in the case of three extra payments or in July and December in the case of two extra payments.

 Social Security Contributions

Social Security payments are another key point when talking about salaries in Spain. Thus, it becomes a crucial issue to determine the total cost of your employees. Social security contributions are determined by the sum of the amounts of monthly payments that are taxable.

In Spain, both employees and employers are liable to pay social security contributions. Employers are required to pay a tax rate of 29.9 percent, based on employee’s gross salary up to a maximum of 4.720,50 € (for 2024, the maximum contribution amount to be considered for social security purposes is 4.720,50 €) for each employee. In addition, employee social security tax rates fall between 4.92 percent and 6.52 percent of their salaries.

Employers must take social security contributions into consideration, before making an offer to a potential employee, as they may find that the salary they have offered becomes unaffordable once social security has been added.

Personal Income Tax Deductions (From Gross to Net)

In Spain, employers withhold a percentage of the employee’s gross salary as a payment on account of the employee’s income tax. There are slightly different rules for permanent and temporary contracts. Generally, for permanent contracts the amount withheld will depend on the size of the salary and the employee’s personal entitlements given some of their personal circumstances. If possible, the amounts withheld should be very close to the actual tax liability of the employee. By doing so, you will minimize any additional payments or refunds should the employee file a tax return following the year end.

The table below shows the 2024 withholding tax rates for a single employee with no children.

 

Witholding Tax for Employees 2024
	2024
Annual Gross Salary (EUR) – Taxable wages	Amount	Withholding tax rate
9.000 €	0,00 €	0,00%
12.000 €	0,00 €	0,00%
15.000 €	0,00 €	0,00%
18.000 €	912,60€	5,07%
20.000 €	1.772,00 €	8,86%
22.000 €	2.631,20 €	11,96%
25.000 €	3.520,00 €	14,08%
27.000 €	4.082,40 €	15,12%
30.000 €	4.923,00 €	16,41%
32.000 €	5.484,80 €	17,14%
35.000 €	6.324,50 €	18,07%
37.000 €	6.885,70 €	18,61%
40.000 €	7.740,00 €	19,35%
45.000 €	9.468,00 €	21,04%
50.000 €	11.200,00 €	22,40%
55.000 €	12.925,00 €	23,50%
60.000 €	14.736,00 €	24,56%
65.000 €	16.588,00 €	25,52%
70.000 €	18.781,00 €	26,83%
75.000 €	21.030,00 €	28,04%
80.000 €	23.280,00 €	29,10%
85.000 €	25.534,00 €	30,04%
90.000 €	27.783,00 €	30,87%
95.000 €	30.029,50 €	31,61%
100.000 €	32.280,00 €	32,28%

 

Taking into account the above (withholding tax rates + social security contributions), we strongly recommend that salaries are always agreed on a gross pay basis. This is common practice when negotiating salaries in Spain.

 

Taxes must be filed by the 20th of each month (or by the 20^th of each month following the end of a quarter: i.e. April 20^th, July 20^th, October 20^th and January 20^th). The annual filing deadline is January 31st of the following year.