Incompatibilities- Compatibilities

The general rule is that the pension is incompatible with being employed or self-employed and being registered with the social security system. However, there are a number of exceptions:

• Partial retirement allows the worker, in agreement with their employer, to reduce their working hours by between 25% and 50% and to receive the retirement pension in inverse proportion to the reduction in working hours. If the worker has not reached regulatory retirement age, their company must arrange a relief contract with another worker.
• Active retirementmakes it possible to combine the retirement pension with full-time or part-time employment or self-employment, provided that retirement has taken place at least one year after reaching the ordinary retirement age (without any bonuses or early retirement age reductions that may be applicable) and, in addition, a percentage may be applied to the base rate of 100% when the person concerned has a full career of contributions. During active retirement, 50% of the pension is paid. However, if the activity is carried out on a self-employed basis and proof is provided that at least one employee is employed, the amount of the pension compatible with work will reach 100%. .
• Flexible retirement allows a person who is already a pensioner to start a part-time job with a reduction in working hours of between 25% and 50% of the normal working hours, and to combine this with the pension they were receiving, reduced in proportion to the percentage of working hours worked part-time.
• The retirement pension is also compatible with self-employment if the total annual income does not exceed the amount of the annual minimum professional wage.
• The contributory retirement pension can also be combined with the development of an activity of artistic creation for which income is received from the ownership of intellectual property rights.

• Primary care practitioners, family doctors and paediatricians, assigned to the National Health System with statutory or civil servant appointments, may, until 28 December 2025, continue to perform their functions during the extension of their active service and, simultaneously, access retirement, receiving 75% of the amount of the pension for this concept, provided that they meet the requirements established by law.

• In the same way, until 28 December 2025, primary care practitioners assigned to the national health system with statutory or civil servant appointments who have been granted a contributory retirement pension will be able to make their activity compatible with 75% of their retirement pension when they return to active service, provided that the causal event giving rise to their pension took place on or after 1 January 2022, or they had availed themselves of the compatibility of their retirement pension with their appointment as statutory or civil servant health professionals under Royal Decree-Law 8/2021 of 4 May, provided that they meet the other requirements established by law.  

Furthermore, the employer's retirement pension is compatible with merely maintaining ownership of the business or commercial establishment, so long as they do not carry out any work.

For personalised information, it is advisable to go to any of the Social Security Assistance and Information Centres (CAISS).

The general rule is that receiving a pension is incompatible with undertaking work either for another person or as a self-employed person or with activities carried out for the Public Administrations.

There are some exceptions to this incompatibility: the retirement pension is compatible with undertaking: 

• Part-time work under the terms established for flexible retirement. The total sum of the retirement pension will be reduced by an amount inversely proportional to the reduction applicable to the working day.
• Self employed work, the total annual income from which does not exceed the annual Minimum Professional Wage (SMI).
• Any work for another person or as a self-employed person carried out by the pensioner, provided they started to draw the pension at the statutory age (without bonuses and not early) and the percentage applicable to the respective base rate for the purposes of determining the sum of the pension reaches 100%. As a general rule, the sum of the pension will be equivalent to 50% of the amount of the pension.

In any case, the pensioner should let the managing body know that they are going to start work.

• Until 28 December 2025, primary care practitioners assigned to the national health system with statutory or civil servant appointments have the possibility of making their activity compatible with 75% of their retirement pension, when they return to active service, provided that the causal event giving rise to their pension took place on or after 1 January 2022, or they had taken advantage of the compatibility of their retirement pension with their appointment as statutory or civil servant health professionals under Royal Decree-Law 8/2021 of 4 May, provided that they meet the other requirements established in the law.

If the worker enters into a part-time work contract, within the legal reduction limits set forth for "flexible retirement", his retirement pension will be reduced inversely proportionate to the reduction applied to the working hours. If he works less than 50% or over 75% of his working hours, his pension will be suspended.

In certain circumstances, as from 17/03/2013, it is possible for workers to reconcile their retirement pension (once it is down to 50% of its full amount) with a full-time or part-time job, with no constraint on the number of working hours.

They can be entitled to two pensions, as long as they meet the individual requirements of each scheme. If they are not affiliated or assimilated to any of the schemes when retiring, the contributions shown in each of them must have overlapped for at least 15 years.

In the event that a pension is not granted in one of the schemes, the certified contribution bases in the latter may be added to the contribution bases in the scheme in which pension eligibility exists, only to determine the regulatory base, as long as the sum of the bases does not exceed the maximum contribution limit in force at any given time.

The retirement pension is compatible with owning a business and the functions attached to ownership, as a result of which it is necessary to delimit the functions attached to ownership in accordance with commercial regulations on employer activity.

In principle, the business owner can perform any relevant or necessary function for achieving their objectives, even if they normally use the help of other people, either because they cannot or do not want to act personally, since the ownership of a business or company does not require the employer to carry out a business activity directly and personally. All that is necessary is that it is carried out in their name, i.e. so that legal relationships with third parties generated are imputed to them as well as all the rights and obligations produced, with the owner assuming the business's risk and expense.

Everything related to the management, administration and normal running of the business must be deemed an incompatible activity with the RETA retirement pension for both the individual employer and the de facto employer of a trading company, as this will give rise to affiliation in the Social Security system possibly resulting in, by way of example, the signing of contracts in general, general wages agreements, the company's representation at and outside of trials, the signing of guarantees...