Summary

Spain has a comprehensive social security system which provides a range of old age, invalidity, sickness, unemployment and other social benefits, including family allowances and income guarantees. Entitlement to benefits generally derives from and individual’s contribution history, although some benefits arise due to residence in Spain.

Although the headline contribution rates of Spanish social security are high, the low level of income at which most contributions are capped means that for more highly paid inbounds, paying Spanish contributions can be considerably cheaper than remaining insured under their home country scheme.

Details

Contributions

Employer contributions are 32.15% of monthly income between €1,381 and €5,101 per month, and employee contributions are 6.48% of the same income.

An additional Solidarity Contribution of around 1% (largely paid by the employer but with an employee element as well) was introduced in 2025 to income above the monthly salary cap, and these rates will increase annual by 0.25% for the next 20 years. The rate in 2026 is between 1.15% and 1.46%, depending on total income.

For most employees, therefore, even with the Solidarity Contributions and other insurances (accident, unemployment etc.), regardless of the level of salary the annual employer cost is limited to a maximum of approximately €22,000, and the employee cost limited to under €4,000.

An ‘intergenerational equity mechanism’ also applies which leads to a small additional employer and employee charge.

Treaties

Spain has social security agreements with all European Economic Area countries and more than 25 non-EEA countries, including the UK, US, Canada, China, Australia and most Latin American countries. These agreements determine which country levies social security contributions, provides benefits, and prevent social security being levied twice on the same income. Most inbounds expatriates to Spain therefore continue to pay home country social security rather than Spanish contributions for up to 5 years. The UK agreement with the EU (and therefore Spain) limits home country coverage to two years. Special rules apply to individuals working in Spain and other EEA countries (plus the UK) on a regular basis.

Given the largely capped cost of Spanish social security and the generally good level of social welfare benefits, assignment planning to avoid having to use the treaty provisions to remain insured at home is, while not widespread, used for some higher paid expatriates.

Exemptions

Per diem allowances to cover subsistence expenses when an individual is working outside their usual work location in Spain can be paid without tax or social security up to certain limits.

Administration

 Non Spanish nationals who become liable to social security need to be registered with the Tresorería General de la Seguridad Social – TGSS. This registration should take place before hiring/arrival in Spain and can be done online. Registrations in Spain are made on a provincial basis rather than as part of a single national process. The same provincial approach applies to most aspects of social security contributions. 

Benefits

 The National Institute of Social Security (Instituto Nacional de la Seguridad Social – INSS) handles state-funded healthcare and welfare entitlements. The benefits system is comprehensive and the level of benefits paid is generally good. The legal retirement age is 66 years and 10 months for employees with less than 38 years 3 months of contributions. The minimum contribution period for a pension is 15 years. 

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