Covid-19 coronavirus crisis in Spain – Government announces financial measures for businesses, the self-employed and individuals

A moratorium on mortgages

The Government will guarantee the right to housing for people with the most difficulties and, therefore, has established a moratorium on the payment of mortgage payments for mortgage debtors in a situation of special vulnerability who see their income decrease.

Economic vulnerability assumptions:

a) That the debtor becomes unemployed or, in case of being an entrepreneur or professional, suffers a substantial loss of income or a substantial drop in sales.
b) That the mortgage payment, plus basic expenses and supplies, is greater than or equal to 35 per cent of the net income received by all the members of the family unit.
c) That, as a consequence of the health emergency, the family unit has suffered a significant alteration in its economic circumstances in terms of effort to pay a mortgage and the rest of the expenses. For the purposes when the effort represented by the mortgage or There has been a substantial drop in sales when this drop is at least 40%

ERTES will be streamlined and all workers will have the right to unemployment (Companies)

The Government has approved to streamline the Temporary Employment Regulation Files (ERTE) and that all affected workers have the right to receive the contributory unemployment benefit even if they do not comply with the minimum contribution period necessary, and that time spent in unemployment will not count as spent.

The regulatory basis of the benefit will be the result of computing the average of the bases of the last 180 days quoted in the company, or failing that, the time immediately prior to the legal unemployment situation. The duration of the suspension will last until the end of the suspension period of the employment contract.

Companies whose activities have been affected such as by closure or cancellation of activities, restrictions on the mobility of people or goods, isolation to avoid contagion, lack of supplies, etc. may request an ERTE due to force majeure.

The procedure will begin at the request of the company, accompanied by a report regarding the link of the loss of the activity as a consequence of COVID-19. The company must communicate its request to the workers.

The existence of force majeure, as a motivating cause for the suspension of contracts, must be verified by the labour authority.

The resolution of the labour authority will be issued within 5 days, taking effect from the date of the act causing the force majeure.

In the cases in which the company decides to suspend the contract for economic, technical, organisational and production reasons related to COVID-19:

• the workers’ representatives must be informed of the situation. In the event that there is no legal representation of the workers, a commission will be formed by three workers from the company itself.
• The consultation period between the company and the workers’ commission shall not exceed seven days.
• The report of the Labor Inspection will be resolved within 7 days.
• The General Treasury of Social Security will exempt the company from the payment of the business contribution to social security during the period of suspension of contracts, when the company has less than 50 workers.
• Workers will not be affected by said exemption.
• The company must request said exemption from the TGSS, identifying the affected workers and the period of suspension.
• All these measures will be in force as long as the extraordinary situation derived from COVID-19 is maintained.

Self-employment benefits for the cessation of activity

Extraordinary benefit for the cessation of activity for those affected by the declaration of the state of alarm for the management of the health crisis situation caused by COVID-19.

Term: one month or until the last day of the month in which said alarm state ends.

Including:

• Self-employed or self-employed workers, whose activities are suspended, pursuant to the provisions of the aforementioned Royal Decree
• Those whose billing in the month prior to which the benefit is requested is reduced by at least 75 percent in relation to the billing average of the previous semester

Requirements:

• Be affiliated and registered, on the date of the declaration of the state of alarm.
• Be up-to-date in the payment of contributions to Social Security

However, if on the date of the suspension of the activity or the reduction in billing this requirement is not met, the managing body will invite the self-employed person to pay so that, within the non-extendable period of thirty calendar days, he will enter the fees due.

Amount:

• 70 per cent to the regulatory base
• When the minimum contribution period is not credited to be entitled to the benefit, the amount of the benefit will be equivalent to 70 per cent of the minimum contribution base in the Special Regime of Social Security for Self-Employed or Self-Employed Workers or, where appropriate, in the Special Social Security Scheme for Sea Workers.

Deferral of tax debts

The deferral of the income of the deferrable tax debts corresponding to all those declarations whose term of presentation and income ends from the date of entry into force of this royal decree-law and until May 30, 2020 will be granted. The conditions of the deferral will be the following:

a) The term will be six months.
b) No default interest will be accrued during the first three months of the deferment.

WE ARE AWAITING MORE NEWS AND WE WILL INFORM YOU AS SOON AS WE GET IT.

WE THINK WE CAN GET THE SOCIAL SECURITY FREE AT THE END OF THE MONTH AT LEAST.

WE ARE WORKING CONSTANTLY TO KEEP YOU UPDATED ON ALL DEVELOPMENTS COMING FROM THE GOVERNMENT. PLEASE UNDERSTAND EVERYTHING IS NEW.

WE KNOW THAT YOU WILL NEVER LOSE THE RIGHTS YOU CAN HAVE – YOU CAN APPLY LATER.

PLEASE STAY CALM AND STAY SAFE BECAUSE IT WILL SOON END.