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Here you can find the essentials of pension plans: their tax deductibility, advantages, and disadvantages, so you can make informed decision

Tax advantages of pension plans:

1. Deduction in the Annual tax report: You can deduct up to €1,500 per year or 30% of your net earnings from work and economic activities (whichever amount is lower).
   If you have a specific plan for self-employed individuals, such as collective plans or social welfare mutual funds, you can deduct an additional €4,250, raising the total limit to €5,750 per year.
2. Flexibility in contributions: There is no minimum amount to contribute, and you can decide how much and when to save according to your financial capacity.
3. Current tax savings: Contributions reduce your taxable income, which may imply significant savings on your income tax return.

Disadvantages to consider:

1. Taxation upon withdrawal: Although you get deductions when contributing, when you withdraw the plan (upon retirement or in exceptional cases), the funds are taxed as employment income, which could increase your taxes if your income is high at that time.
2. Contribution limits: Deductions are capped, and any contribution exceeding the maximum allowed cannot be tax-deductible.
3. Money immobilization: The savings remain locked until you reach retirement age, except in special situations (such as serious illness or long-term unemployment).
4. Management fees: Some pension plans have fees that could reduce the profitability of your contributions.

For more details on pension plans and their conditions, you can consult the official page of the Spanish Tax Agency, as well as review the summary table provided by Hacienda at this link.