In this article, we will explain how to calculate extra pay in Spain, providing a step-by-step guide, tips and recommendations to do it correctly.

In addition, we will address possible mistakes to avoid and how the extra payment affects the payment of taxes in Spain.

This article is intended for both employees and employers, so that both can understand how extra pay is calculated and how it affects their financial situation.

The extra pay It is additional compensation that is granted to workers, normally twice a year, in specific periods like Christmas and summer.

Its purpose is to provide additional income during times of increased expenses and generally improve the standard of living of employees.

In Spain, labor legislation establishes certain requirements and limits for extra pay, which both employees and employers must know and comply with.

Step-by-step guide to calculating extra pay

1. Identify the amount of extra payments and their frequency

First of all, it is necessary to know how many you pay extra will be paid and on what dates they will be paid. Generally, in Spain two extra payments are established, one in summer and another at Christmas, although this may vary depending on the collective agreement or individual employment contract.

It is essential to know this information to be able to correctly calculate the extra pay.

2. Determine the annual base salary

The next step is to determine the annual base salary of the worker, which is the gross annual salary before applying deductions and taxes.

This annual base salary can be found in the employment contract or in the applicable collective agreement. Make sure the figure is the annual gross salary and not the net salary.

3. Divide the annual base salary by the number of payments

Once the annual base salary is known, this figure must be divided by the total number of payments the employee receives in a year, including extra payments.

For example, if an employee has a base annual salary of 24,000 euros and receives 14 payments per year (12 monthly payments plus 2 extra payments), 24,000 euros must be divided by 14, which results in 1,714.29 euros per payment.

4. Calculate prorated extra pay if necessary

In some cases, the you pay extra They can be prorated, that is, they are spread throughout the year instead of being paid at two specific times.

If this is the case, you must calculate the corresponding part of the extra pay which is included in each monthly salary.

To do this, divide the total amount of extra payments (the result obtained in step 3) by 12 months.

For example, if the extra payments total 3,428.58 euros per year (1,714.29 euros for each of the two extra payments), The prorated part of the extra pay included in each monthly salary would be 285.72 euros.

Tips and recommendations

1. Consult the collective agreement and employment contract

It is essential to consult both the collective agreement As the Work contract to know the specific conditions applicable regarding extra payments.

In some cases, extra payments may be higher than those established by law, or their frequency may vary.

It is also possible that extra pay is prorated, as we mentioned above.

2. Take into account possible deductions

When calculating the extra pay, do not forget to take into account the possible deductions that may apply, such as Social Security contributions, taxes or withholdings for other concepts.

These deductions may vary depending on the employee’s personal and work situation, so it is important to consider them to obtain an accurate calculation.

3. Verify the calculation with the human resources department or labor consultancy

If you have questions about the calculation of the extra pay, do not hesitate to consult with the department of human Resources from your company or with a labor consultancy.

These professionals have experience calculating salaries and will be able to resolve any questions or discrepancies you may have.

4 mistakes to avoid

When calculating extra pay, it is important to avoid some common mistakes that can lead to incorrect calculation. These errors include:

Not taking into account the collective agreement or employment contract when calculating extra pay.

Confusing gross salary with net salary when determining annual base salary.

Do not include possible deductions in the calculation of extra pay.

Do not consult with professionals in case of doubts or discrepancies.

Extra pay and taxes in Spain

The you pay extra They are subject to taxes in Spain, like the rest of the labor remuneration. Therefore, it is important to note that the extra pay can increase the tax base of the employee and, therefore, affect the amount of taxes he must pay.

The Personal Income Tax (IRPF) is applied on the taxable base, which includes the base salary, extra pay and other labor compensation. Personal income tax is withheld directly from the employee’s payroll, including extra payments.

In general, as the tax base increases, so does the amount of taxes payable.

Therefore, it is important to properly plan tax payments and take into account the effect of extra payments on the employee’s tax situation.

In case of doubts or queries about the impact of the extra pay on taxes, it is advisable to consult with a tax advisor or the company’s human resources department.

Conclusion

Calculate the extra pay It is a simple process if you know the relevant variables and follow the appropriate steps.

It is essential to take into account the collective agreement, the employment contract, the annual base salary and possible deductions when making the calculation.

In addition, it is important to be aware that extra pay affects tax payments and to properly plan the employee’s tax situation.

If you have questions or queries about the calculation of the extra pay, do not hesitate to contact with your company’s human resources department or with employment advice.

These professionals will be able to help you obtain an accurate calculation and solve any discrepancy that you can find.