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Gestión LaboralIf you are unemployed, you may have heard about the capitalization of unemployment benefits. This option can be interesting for those people who are collecting unemployment benefits and want to start a new business. This is an option in which unemployed people ask the State to collect all their unemployment benefits at once, in order to invest that money in the creation of a business. In this way, the unemployed can transform a bad situation into an opportunity to start their own business and become successful entrepreneurs.
The capitalization of unemployment is an increasingly valued option among Spaniards. Every year there are tens of thousands of new applications to obtain this economic aid and become self-employed, partners of an SL or working partner of a cooperative or worker-owned company.
There are a series of requirements to be able to obtain this aid to entrepreneurship. These conditions are a measure to ensure that the person requesting this payment is really interested in starting a new business venture. It is convenient to be very clear about the previous questions to start a business before applying for this aid, especially if we take into account the need to present a report of the activity for its approval.
It should be clarified that, in the event that there is a contestation in the dismissal, it is necessary to wait until the contestation file has been resolved in order to request the lump-sum payment.
Many of the applications for the lump-sum payment of unemployment benefits are intended to become self-employed. It may also be required for the founding of an SL. On other occasions, it is intended to become a working partner of a labor company or cooperative. Whatever the case, it is necessary to clarify that this money cannot be used completely freely.
The State, as is the case with the possibility of exercising an application, has a series of requirements to ensure that the money is used for a legitimate purpose. Depending on the use to which this money is put, we can divide the capitalization into three types: for the initial investment, for the payment of installments and partial capitalization.
This modality consists of allocating 100% of the money received in expenses for the new business. If we are talking about the self-employed, these expenses will have to be justified as the purchase of materials, equipment or tools necessary for the economic activity (for example, to buy computers, printers and tables), expenses for the adaptation of the premises in which the activity is going to be carried out or the acquisition of licenses or franchises, among others.
If we are talking about an application for labor or cooperative companies or the foundation of a limited company, this investment must be justified as contributions to the social capital.
In this case, the money is not going to be spent on purchases or license payments, but is destined to pay the self-employed quota. One of the biggest concerns of Spaniards when starting a self-employed business is the social security contribution. For that reason, the possibility of destining this money to cover this obligatory expense can be a great help in the first steps of the new business. In this case, the money would not be given directly to the applicant, but the contributions would be compensated on a monthly basis.
This capitalization model is nothing more than a hybrid between the two previous ones. If the applicant is not going to need all the money for the initial investment, he/she can ask for a percentage to be used for these investments, and the rest will be used to compensate the Social Security contributions.
This situation can occur, for example, in the case of the foundation of limited liability companies. The minimum capital stock when creating a limited liability company is 3,000 euros. Therefore, it may be the case that a person is entitled to a higher unemployment benefit. In this situation, a partial capitalization could be used to pay the 3,000 euros of share capital, leaving the remainder to offset future Social Security contributions.
To apply for the capitalization of unemployment, once we are sure that we meet the requirements explained above, we will have to go to the State Public Employment Service (SEPE). This request can be made either at the time of applying for unemployment benefits or at any time thereafter. Let us remember that one of the requirements for this capitalization is to start the economic activity within a maximum period of one month, so it is convenient to have everything tied up before making this application.
When making the application, it is necessary to submit two documents. The first one is the single payment application form. This is an official document that can be found on the SEPE website. The second document is the application report for the single unemployment payment. This document is perhaps the more important of the two. It is the one that justifies to the administration what the requested money is going to be spent on. This document consists of a detailed report on why this amount of money is being requested and what it will be spent on. As we have seen, the administration is very vigilant in the use of the unemployment money, so it is advisable that this report be as detailed as possible.
Finally, one of the most frequently asked questions when talking about the capitalization of unemployment is its relationship with the IRPF. This State aid is tax exempt, although it is subject to one condition: the professional activity must have been carried out for at least 5 years. If this is not the case, the lump-sum unemployment payment must be subject to personal income tax. Previously there was a limit of 15,500 euros in this exemption. This has been eliminated to encourage unemployed people to take advantage of this option.
At Vasalto, we are experts in labor management. We specialize in helping companies and the self-employed with all processes related to labor relations management. If you are thinking of capitalizing your unemployment and need advice, do not hesitate to call us.
Our more than 30 years of experience have given us a great experience in the sector. In addition, we are a company very involved with technology. Throughout these years we have developed a series of proprietary computer systems that allow us to manage more than 40,000 payrolls every month. In addition, we also have the best legal and accounting advice to offer our clients the best possible service.
At Vasalto, we believe that communication between people is fundamental. We make technology available to people, never the other way around. We work with technological automation solutions so that IT takes as much work off our hands as possible. This way, we have more time to dedicate to our customers.