More and more freelancers and professionals in Spain receive income through platforms like PayPal or Stripe. Whether it’s from selling products, digital services, or affiliate commissions, a common question arises: how should these earnings be declared to the Spanish Tax Office?
In this article, we explain how to declare PayPal payments and Stripe income in Spain, which tax forms you need to file, and what mistakes to avoid to remain compliant with tax regulations.
📌 If you work online and need professional tax advice, Lextax can help you declare your income correctly and without hassle.
Do I need to declare income from PayPal or Stripe?
Yes. Any income you receive as a tax resident in Spain must be declared to the Agencia Tributaria (Spanish Tax Agency), regardless of whether it’s deposited in a bank account or received via platforms like PayPal or Stripe.
Although these platforms act as payment gateways, they are not invisible to the Tax Agency. You are legally required to declare any income obtained through them as part of your economic activity.
How to declare PayPal or Stripe payments while working from Spain
- Register as a freelancer or company
The first step is to register with the Spanish Tax Agency using form Modelo 036 or Modelo 037. If you regularly receive income, you must be included in the census of business owners, professionals, and withholding agents.
- Issue invoices for every payment
You must issue an invoice for every payment received, regardless of the client’s country. Each invoice must include the legally required information: your tax data, description of the service, taxable amount, applicable VAT rate, and total amount.
- Mandatory tax forms to submit
Depending on your tax regime, you must file the following:
- Modelo 130: Quarterly personal income tax (IRPF) payments.
- Modelo 303: Quarterly VAT return.
- Modelo 390: Annual VAT summary.
- Modelo 349: For intra-community transactions if invoicing EU-based companies.
- Modelo 100: Annual income tax return.
What happens if you don’t declare PayPal or Stripe income?
Failing to declare digital income is a significant tax risk. The Tax Agency can detect bank transactions and may request information directly from PayPal or Stripe if it suspects undeclared activity.
Possible consequences include:
- Fines and interest for late payment
- Loss of tax deductions
- Tax audits or inspections
What if I only receive money occasionally?
The Spanish Tax Agency does not set a minimum exemption. If you receive income with some regularity and there is an intent to earn a profit, it is considered economic activity and must be declared—even if it’s only occasional.
Not registering, even for a one-time activity, may lead to penalties for failing to meet tax obligations.
Can I deduct PayPal or Stripe fees?
Yes. Freelancers and businesses can deduct commissions, service fees, and other charges related to the use of these platforms, provided they are properly documented with an invoice or accounting statement.
How can Lextax help?
At Lextax, we are experts in digital taxation. If you receive payments through PayPal or Stripe, we can help you:
- Properly declare your income
- Issue and record invoices in line with legal requirements
- Submit your tax forms without mistakes
- Deduct platform fees legally
- Avoid penalties and optimize your digital tax burden
Conclusion
Receiving income via PayPal or Stripe does not exempt you from declaring your earnings. If you live and work in Spain, declaring PayPal payments is mandatory, even if your business is online or your clients are abroad.
Complying with tax regulations not only protects you from fines but also allows you to grow your business securely and professionally.
📞 Need help declaring your online income? At Lextax, we’ll guide you through the entire process so you stay compliant and confident with your taxes.
Frequently Asked Questions
Do I need to declare income even if I haven’t transferred it to my bank account?
Yes. The obligation to declare arises at the moment the income is generated, not when you transfer the funds. The Tax Agency considers funds in PayPal or Stripe as part of your taxable income.
Do PayPal or Stripe report to the Spanish Tax Agency?
Not automatically, but they may be required to share data with tax authorities if an investigation is opened or under information-sharing agreements.
Do I need to issue invoices if my clients are outside Spain?
Yes. You must always issue an invoice for every payment. In the case of foreign clients, VAT may not apply, but invoicing and declaring the income are still required.
Which tax forms must I file as a freelancer receiving PayPal income?
You must submit Modelo 130 (IRPF), Modelo 303 (VAT), Modelo 390 (annual VAT summary), and Modelo 100 (income tax). If you invoice clients within the EU, also submit Modelo 349.