Totalization Agreement with Spain

An agreement effective April 1, 1988, between the United States and Spain improves Social Security protection for people who work or have worked in both countries. It helps many people who, without the agreement, would not be eligible for monthly retirement, disability or survivors benefits under the Social Security system of one or both countries. It also helps people who would otherwise have to pay Social Security taxes to both countries on the same earnings.

The agreement covers Social Security taxes (including the U.S. Medicare portion) and Social Security retirement, disability and survivors insurance benefits. It doesn’t cover benefits under the U.S. Medicare program or the Supplemental Security Income (SSI) program.

This document covers highlights of the agreement and explains how it may help you while you work and when you apply for benefits.

• While you work–If your work is covered by both the U.S. and Spanish Social Security systems, you (and your employer, if you are employed) would normally have to pay Social Security taxes to both countries for the same work. However, the agreement eliminates this double coverage so you pay taxes to only one system (see Part II).

• When you apply for benefits–You may have some Social Security credits in both the U.S. and Spain but not have enough to be eligible for benefits in one country or the other. The agreement makes it easier to qualify for benefits by letting you add together your Social Security credits in both countries. For more details, see the section on "Monthly Benefits" in Part IV.

Before the agreement, employees, employers and self-employed persons could, under certain circumstances, be required to pay Social Security taxes to both the United States and Spain for the same work.

Under the agreement, if you work as an employee in the United States, you normally will be covered by the United States, and you and your employer will pay Social Security taxes only to the United States. If you work as an employee in Spain, you normally will be covered by Spain, and you and your employer pay Social Security taxes only to Spain.

On the other hand, if your employer sends you from one country to work for that employer or an affiliate in the other country for five years or less, you will continue to be covered by your home country and you will be exempt from coverage in the other country. For example, if a U.S. company sends an employee to work for that employer or an affiliate in Spain for no more than five years, the employer and the employee will continue to pay only U.S. Social Security taxes and will not have to pay in Spain.

If you are self-employed and reside in the United States or Spain, you generally will be covered and taxed only by the country where you reside.

NOTE: In addition to retirement, survivors and disability benefits, Spanish Social Security taxes cover several other programs including short-term sickness benefits, health insurance, unemployment benefits, workers’ compensation and family allowances. As a result, workers exempted from Spanish Social Security coverage by the agreement pay no Social Security taxes for these programs and generally cannot receive benefits from them. If the agreement exempts you from Spanish coverage, you and your employer may wish to arrange for alternative benefit protection.

The following table shows whether your work is covered under the U.S. or Spanish Social Security system. If you are covered under U.S. Social Security, you and your employer (if you are an employee) must pay U.S. Social Security taxes. If you are covered under the Spanish system, you and your employer (if you are an employee) must pay Spanish Social Security taxes. Part III explains how to get a form from the country where you are covered that will prove you are exempt in the other country.

To establish an exemption from compulsory coverage and taxes under the Spanish system, your employer must request a certificate of coverage (form USA/E 1) from the U.S. at this address:

Social Security Administration
Office of International Programs
P.O. Box 17741
Baltimore, Maryland 21235-7741
U.S.A.

The request may be sent by FAX, if preferred, to (410) 966-1861.   Please note this FAX number should only be used for requesting certificates of coverage. 

No special form is required to request a certificate, but, the request must be in writing and provide the following information:

-full name of worker (including both surnames for Spanish nationals);
-date and place of birth;
-citizenship;
-country of worker's permanent residence;
-U.S. Social Security number;
-Spanish Social Security number (if known);
-date of hire;
-country of hire;
-name and address of the employer in the U.S. and Spain; and
-date of transfer and anticipated date of return.

In addition, your employer must indicate if you remain an employee of the U.S. company while working in Spain or if you become an employee of the U.S. company’s affiliate in Spain. If you become an employee of an affiliate, your employer must indicate if the U.S. company has an agreement with the Internal Revenue Service under section 3121(l) of the Internal Revenue Code to pay U.S. Social Security taxes for U.S. citizens and residents employed by the affiliate and, if yes, the effective date of the agreement.

Your employer can also request a certificate of U.S. coverage for you over the Internet using a special online request form available at www.socialsecurity.gov/coc. Only an employer can use the online form to request a certificate of coverage. A self-employed person must submit a request by mail or fax.

To establish your exemption from coverage under the U.S. Social Security system, your employer in Spain must request a certificate of coverage (form E/USA 1) from the provincial office of the National Institute of Social Security in the Spanish province where the employer is located.

The same information required for a certificate of coverage from the United States is needed to get a certificate from Spain except that you must show your Spanish Social Security number rather than your U.S. Social Security number.

If you are self-employed and would normally have to pay Social Security taxes to both the U.S. and Spanish systems, you can establish your exemption from one of the taxes by writing to:

• if you reside in the United States, the U.S. Social Security Administration at the address in Part III.A above; or

• if you reside in Spain, the provincial office of the National Institute of Social Security in the Spanish province where you conduct your business.

Be sure to provide the following information in your letter:

-full name (including both surnames for Spanish nationals);
-date and place of birth;
-citizenship;
-country of permanent residence;
-U.S. and/or Spanish Social Security number;
-nature of self-employment activity;
-dates the activity was or will be performed; and
-name and address of your trade or business in both countries.

 

The certificate of coverage you receive from one country will show the effective date of your exemption from paying Social Security taxes in the other country. Generally, this will be the date you began working in the other country.

Certificates of coverage issued by Spain should be retained by the employer in the United States in case of an audit by the Internal Revenue Service (IRS). No copies should be sent to IRS unless specifically requested by IRS. However, a self-employed individual must attach a photocopy of the certificate to his or her tax return each year as proof of the U.S. exemption. 

Copies of certificates of coverage issued by the United States will be provided for both the employee and the employer. It will be their responsibility to present the certificate to the Spanish authorities when requested to do so. To avoid any difficulties, your employer (or you, if you are self-employed) should request a certificate as early as possible, preferably before your work in the other country begins.

If you or your employer request a certificate of coverage, you should read the Privacy Act and Paperwork Reduction Act Statements below.

The following table shows the various types of Social Security benefits payable under the U.S. and Spanish Social Security systems and briefly describes the eligibility requirements that normally apply for each type of benefit. If you don’t meet the normal requirements for these benefits, the agreement may help you to qualify (see Part IV.A below).

This table is only a general guide. You can get more specific information about U.S. benefits here on our web site or at any U.S. Social Security office or by calling our toll-free number at 1-800-772-1213. You can get more detailed information about the Spanish system by writing to the Spanish address in Part VIII or by visiting the Spanish Social Security system’s web site at www.seg-social.es.

Under U.S. Social Security, you may earn up to four credits each year depending on the amount of your covered earnings. For example, in 2003, you get one credit for each $890 of your covered annual earnings up to a maximum of four credits for the year. Under the Spanish system, credits are measured in days of contributions. To simplify the information in the table, requirements are shown in years of credits.

If you have Social Security credits in both the United States and Spain, you may be eligible for benefits from one or both countries. If you meet all the basic requirements under one country’s system, you will get a regular benefit from that country. If you don’t meet the basic requirements, the agreement may help you qualify for a benefit as explained below.

If you don’t have enough work credits under the U.S. system to qualify for regular benefits, you may be able to qualify for a partial benefit from the United States based on both U.S. and Spanish credits. However, to be eligible to have your Spanish credits counted, you must have earned at least six credits (generally one and one-half years of work) under the U.S. system. If you already have enough credits under the U.S. system to qualify for a benefit, the United States cannot count your Spanish credits.

Social Security credits from both countries can also be counted, when necessary, to meet the eligibility requirements for Spanish benefits. To be eligible to have your U.S. and Spanish credits counted, you must have at least one year of coverage credited under the Spanish system.

You don’t have to do anything to have your credits in one country counted by the other country. If we need to count your credits under the Spanish system to help you qualify for a U.S. benefit, we will get a copy of your Spanish record directly from Spain when you apply for benefits. If Spain needs to count your U.S. credits to help you qualify for a Spanish benefit, they will get a copy of your U.S. record directly from the Social Security Administration when you apply for the Spanish benefit.

Although each country may count your credits in the other country, your credits are not actually transferred from one country to the other. They remain on your record in the country where you earned them and also can be used to qualify for benefits there.

When a U.S. benefit becomes payable as a result of counting both U.S. and Spanish Social Security credits, an initial benefit is determined based on your U.S. earnings as if your entire career had been completed under the U.S. system. This initial benefit is then reduced to reflect the fact that Spanish credits helped to make the benefit payable. The amount of the reduction will depend on the number of U.S. credits: the more U.S. credits, the smaller the reduction; and the fewer U.S. credits, the larger the reduction.

If you qualify for Social Security benefits from both the United States and Spain and you didn’t need the agreement to qualify for either benefit, the amount of your U.S. benefit may be reduced. This is a result of a provision in U.S. law which can affect the way your benefit is figured if you also receive a pension based on work that was not covered by U.S. Social Security. For more information, call our toll-free number, 1-800-772-1213, and ask for the factsheet, Windfall Elimination Provision (Publication #05-10045). If you are outside the United States, you may write to us at the address in Part VIII.

Medicare is the U.S. national health insurance system for people age 65 or older or who are disabled. Medicare has two parts: hospital insurance (also called "Part A" Medicare) and medical insurance (called "Part B" Medicare). You are eligible for free hospital insurance at age 65 if you have worked long enough under U.S. Social Security to qualify for a retirement benefit. People born in 1929 or later need 40 credits (about 10 years of covered work) to qualify for retirement benefits.

Although the agreement between the United States and Spain allows the Social Security Administration to count your Spanish credits to help you qualify for U.S. retirement, disability or survivor benefits, the agreement doesn’t cover Medicare benefits. As a result, we cannot count your credits in Spain to establish entitlement to free Medicare hospital insurance.

For more information about Medicare, call our toll-free number, 1-800-772-1213, and ask for the booklet, Medicare (Publication #05-10043) or visit Medicare’s website at www.medicare.gov.

If you live in the United States and wish to apply for U.S. or Spanish benefits:

• visit or write any U.S. Social Security office; or

• phone our toll-free number, 1-800-772-1213, 7 a.m. to 7 p.m. any business day. People who are deaf or hard of hearing may call our toll-free TTY number, 1-800-325-0778.

You can apply for Spanish benefits at any U.S. Social Security office by completing an application form E/USA.

If you live in Spain and wish to apply for U.S. or Spanish benefits, contact:

• the Federal Benefits Unit at the U.S. Embassy in Madrid (phone 91-587-2261) to file for U.S. benefits; or
  
  
• any Spanish Social Security office to file for Spanish benefits.

If you haven’t applied for benefits before, you may need to provide certain information and documents when you apply. These include the worker’s U.S. and Spanish Social Security numbers, proof of age for all claimants, evidence of the worker’s U.S. earnings in the past 24 months and information about the worker’s coverage under the Spanish system. You may wish to call the Social Security office before you go there to see if any other information is needed.

Each country pays its own benefit. U.S. payments are made by the U.S. Department of Treasury each month and cover benefits for the preceding month. Spain also pays benefits each month for the preceding month. Resident of the United States generally receive benefits from Spain through international postal money orders.

Normally, persons who are not U.S. citizens may receive U.S. Social Security benefits while outside the U.S. only if they meet certain requirements. Under the agreement, however, you may receive benefits as long as you reside in Spain regardless of your nationality. If you are not a U.S. or Spanish citizen and live in another country, you may not be able to receive benefits. The restrictions on U.S. benefits are explained in the booklet,"Social Security—Your Payments While You Are Outside The United States" (Publication #05-10137).

If you disagree with the decision made on your claim for benefits under the agreement, contact any U.S. or Spanish Social Security office. The people there can tell you what you need to do to appeal the decision.

The Spanish Social Security authorities will review your appeal if it affects your rights under the Spanish system, while U.S. Social Security authorities will review your appeal if it affects your rights under the U.S. system. Since each country’s decisions are made independently of the other, a decision by one country on a particular issue may not always conform with the decision made by the other country on the same issue.

To file a claim for U.S. or Spanish benefits under the agreement, follow the instructions in Part VII.

To find out more about U.S. Social Security benefits or for information about a claim for benefits, contact any U.S. Social Security office. If you live outside the United States, write to:

Social Security Administration
OIO—Totalization
P.O. Box 17769
Baltimore, Maryland 21235-7769
U.S.A.

For more information about Spain’s Social Security programs, visit any Social Security office in Spain. If you don’t live in Spain, write to:

Instituto Nacional de la
Seguridad Social
Calle Padre Damian 4 y 6
28036 Madrid
SPAIN

If you don't wish to file a claim for benefits, but would like more information about the agreement, write to:

Social Security Administration
Office of International Programs
P.O. Box 17741
Baltimore, Maryland 21235-7741
U.S.A.