As anyone self-employed in Spain knows, the tax system can be a little complicated at times. 

Knowing when and exactly how much you’ll need to pay, or if you’ve overpaid or underpaid and how much you’re owed by the tax authorities (known as la hacienda in Spain) can be a headache – and that’s if you’ve declared everything you should.

Spain’s tax rates for the self-employed, including both income tax and the monthly social security charge, are some of the highest in Europe. This presents some temptations for some self-employed people.

Now, most self-employed people and small businesses owners in Spain of course declare (and pay) their fair share. But there are those that don’t, and there are some declare most of their income but find ways to move around or hide some of it in order to try and save money.

During the annual tax return season, self-employed people must fill out their tax information themselves so they are trusted to tell the truth. It can be a bit of a bureaucratic nightmare, especially if you aren’t a native Spanish speaker.  That’s why many opt to hire a gestor to take care of these things for them.

READ ALSO: What does a ‘gestor’ do in Spain and why you’ll need one

One of the biggest worries for self-employed people is that once they’ve submitted their tax return, then begins a long checking and cross referencing process to make sure the information is correct and you aren’t dodging any tax or hiding any income. They check bank statements, coordinate with the banks themselves, and make sure everything is properly declared and that you’ve crossed all your T’s and dotted all your I’s. 

But it recently emerged in Spain that the tax authorities are also using a new way to keep an eye on the self-employed: social media. 

Speaking to Autónomos y Emprendedores, a self-employed business newspaper and website, Hacienda officials admitted that they at times check Instagram, TikTok, Twitter and Facebook profiles and even Google reviews can be used to detect discrepancies and possible indications of tax fraud.

Officials from Spain’s Tax Officials Union (Gestha) explained to the website that although social media stalking doesn’t “form part of the main line of investigation”, social media accounts are checked by the authorities as a way of detecting any discrepancies between what’s officially presented in tax returns and the lifestyle posted online.

READ ALSO: How does Spain know if I’m a tax resident?

One example given was that of an event photographer who uploads more work to Instagram than he or she declares, “or a hotel establishment that declares a certain level of income, and it is clear from reviews and customer comments that they are more successful than they appear to be”.

This means that seemingly harmless posts online can be interpreted as evidence of undeclared income, leading to penalties and even tax audits in extreme cases.

So, how do they do it?

The tax authorities in Spain reportedly look out for four keys things online:

Advertising and promotions: Officials study offers and discounts advertised online to check that income is correctly declared.

Comments and reviews: Hacienda even checks comments like Google reviews and other interactions businesses have with customers to find undeclared sales or services.

Lifestyle and wealth: Officials are even checking photo uploads and social media posts about travel, cars or luxury items that may raise suspicions about a possible gap between your lifestyle and what you declared in your tax return — so that selfie from Dubai could cost you if you’ve underreported your income in your tax return.

Prize giveaways: Small businesses doing draws like raffles and other prize giveaways have tax obligations and evidence of these posted online will checked to ensure that they’re being declared and complied with.

READ ALSO: When do banks inform Spain’s Hacienda tax office of your transactions?