Whenever we face a case of late payment we run the risk of reaching extreme situations that are unpleasant for both parties. On this occasion we are talking about embargo, an extreme point that is reached when practically all possibilities of settling an outstanding debt have been exhausted. This is an uncomfortable situation for both the person who owes money and the person who is waiting to receive the corresponding payment. In this post we explain what a garnishment is and, specifically, we resolve a question that usually raises great concern: how much can they garnish my payroll? Keep reading!
What is an embargo?
An embargo is the retention of a person's assets when he or she fails to pay a debt. The judge or the competent authority are figures in charge of ordering the embargo.
Once the embargo has been carried out, the defaulter will not be able to dispose of the assets that have been retained and may be sold to satisfy the debt contracted with the money obtained.
What can be seized?
If you have an outstanding debt and you think you are about to suffer a seizure, it is important that you know that not all assets can be seized in our country. Let's see what can be seized and what cannot:
Assets that can be seized
A judge could seize any of the following assets when the owner is a delinquent person:
- A bank account or money.
- Titles, rights and securities such as shares or funds.
- Pieces of art or jewelry.
- Income and interest.
- Real estate.
- Salaries and pensions, although there is an amount that can never be seized, as we will see later.
Assets that cannot be seized
The assets we list below are untouchable, they can never be seized:
- Furniture, household items, clothing, food and essential goods for living.
- The books and tools you use to develop your profession.
- Religious objects intended for worship practice.
Can my payroll be garnished?
As can be seen from the previous section, yes, your payroll can be garnished. You must keep in mind that only a court or a Public Administration can order the seizure of a payroll.
The creditor cannot directly seize the debtor, unless it is a Public Administration. It must always be a court or tribunal that gives the order through a final ruling and after a judicial debt claim process.
When we talk about Public Administrations, we are mainly referring to the State Tax Administration Agency (AEAT) and the General Treasury of Social Security (TGSS). Usually, when these entities order the seizure of a payroll, it is a consequence of non-payment of taxes or outstanding Social Security contributions. In these cases, the corresponding administration is responsible for decreeing the embargo.
How much can they garnish my payroll if I owe money?
First of all, if it is imminent that your payroll is going to be garnished, don't worry! No authority or Public Administration may seize your entire payroll. By law, they cannot seize the amount equivalent to the Minimum Interprofessional Salary (SMI), which currently corresponds to 1,134 euros per month. Furthermore, the article 607 of the Civil Procedure Law establishes the following embargo sections:
- Between 1,134 and 2,268 euros, 30% may be seized
- Between 2,268 and 3,402 euros, 50%.
- Between 3,402 and 4,536 euros, 60%
- Between 4,536 and 5,670 euros, 75%
- Amounts greater than 5,670 euros, 90%.
Regulations on payroll seizure. What should I take into account?
Up to this point, we have indicated the percentages that can generally be garnished from payroll. However, there are regulations that may cause the resulting amount to vary. If you want to know exactly How much can they seize from your payroll?, you must also take these rules into account:
- Garnishment percentages can be reduced by between 10% and 15% if the worker has family responsibilities.
- There are parts of your salary that can never be seized, such as severance pay, transportation bonuses, and allowances for maintenance or accommodation.
- When there are extraordinary payments, the embargo grows proportionally. And, if they were prorated, the SMI limit will include the proration.
- If there are two payers, the garnishment is usually proportional. Each company retains the corresponding part.
- Two simultaneous seizures cannot be applied to a worker. If a company is already executing the seizure of a payroll and receives another notification for the same worker, it must respond to the Administration or Court that until the one that is already in progress is settled, it will not be able to execute the new request.
Do you still have doubts about how much they can garnish your payroll? Consult now with Afianza advisors, a team of professionals will offer you the information you need to protect your assets, including the part of your salary that can never be seized.
