Spain Payroll Guide

Hiring Employees in Spain
Currency
Euro (EUR)
Population
47,329,981
Capital
Madrid
Official language(s)
Spanish, Catalan, Basque, Galician
Date format
dd/mm/yyyy
Fiscal year
1 January – 31 December
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Hiring Employees in Spain

In Spain, the monthly minimum wage is €1,184 with two additional payments of this amount being made in July and December each year. This equates to a minimum hourly rate of €9.26. 

The Spanish income tax rates since March 2025 are as follows:

  • For income up to €12,450 – 19% tax rate
  • For income ranging from €12,451 to €20,200 – 24% tax rate
  • For income ranging from €20,201 to €35,200 – 30% tax rate
  • For income ranging from €35,201 to €60,000 – 37% tax rate
  • For income ranging from €60,000 to €300,000 – 45% tax rate
  • For income over €300,000 – 47% tax rate

In Spain, the total amount contributed towards the state pension system is 28.3% of an employee’s salary, with the majority of this being paid by the employer (23.8%), and the remaining 4.7% being paid by the employee.

The standard working hours in Spain are 8 hours per day and 40 hours per week (the statutory maximum), usually from Monday to Friday.

Employee’s leave consists of several types:

  • Statutory time off or annual leave, which is a minimum of 30 calendar days (or 22 working days) per year for full-time employees
  • Public holidays (14 per year in Spain)
  • Maternity, Paternity and Parental leave
  • Sick leave

Termination of an employment contract in Spain is complex and is covered by several laws and any contractual obligations made at the time employment commenced.

Legally compliant dismissals come under Articles 49 to 56 of the Workers’ Statute and can include:

  • Mutual agreement between the parties
  • Employee resignation
  • Disciplinary, objective or collective dismissal
  • Expiration of temporary contract

 

All dismissals must follow specific procedures to ensure compliance with labour laws which include, but are not limited to, a minimum notice period, written notification, severance pay and a settlement agreement.  

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Frequently Asked Questions

How does payroll work in Spain?

Spain is split into 17 different regions, all slightly varying in legislation and tax requirements. This is handled under a CBA (Collective Bargaining Agreement) which is allocated upon commencement of employment. Most employees receive fourteen payments throughout a year with the additional two being received in July and December.

What are the regulations around leave?

When an employee is sick for up to three days, there is no compensation for those missed days. Once that leave extends from four to fifteen days, the employer is then liable for 60% pay for each day. For any sick leave extending longer than that, Spanish Social Security will take over payments until the maximum leave period is reached (eighteen months).

What about dismissing an employee?

Employment rights are very strict in Spain and we always suggest the use of a local lawyer. Generally, employees must be given at least fifteen days’ notice if they are dismissed on objective grounds. There is no notice required for employees dismissed for disciplinary reasons.

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