New Spanish Digital Nomad Tax Regime



The mainstream implementation of telework has led to an exponential increase in workers whose jobs allow them to work remotely. To be a digital nomad is now more feasible than ever. With its connectivity and exceptional quality of life, Spain is one of the most attractive and inspiring destinations for digital nomads and international remote workers.

The Spanish government has approved the new start-up law to ease the arrival of innovative entrepreneurship in Spain by attracting investment and talent. This law aims to simplify procedures for the creation of new companies, and it establishes new incentives for entrepreneurs and highly qualified international remote workers and digital nomads.

In this regard, Spain has launched the visa and residence permit for international teleworkers (also known as Digital Nomad Visa and residence permit) addressed both for international remote workers (individuals working for a foreign company) and freelancers (self-employed individuals) who can prove that they can maintain their current activity working remotely from Spain without needing a local sponsoring entity.

One of the many tax developments of this new legislation refers to the current Spanish tax regime for expatriates. This special regime, well-known as Beckham Law (as the football player was one of the first to take advantage of this measure), allows those taxpayers who move to Spain to work and pay taxes as a non-resident for a 6-year period. Not only can be eligible for expatriates but also from 2023 onwards it will apply to entrepreneurs, investors and professionals who perform a business activity (self-employed) and want to be relocated to Spain.

The Spanish legislation modifies the expatriate tax regime and reduces from 10 to 5 years the period of non-residence in Spain prior to the year of arrival in Spain. The movement can take place both in the first year of application of the regime and in the previous year.

Article 93 of the Spanish Personal Income Tax Act regulates the special tax regime and establishes a flat tax rate of 24% for employment income up to EUR 600,000.00 and 47% above that amount. This taxation is currently in force prior to this new legislation.

Moreover, the regulations will add new reasons to apply for the Beckham Law. Up to now, only physical displacement due to an employment relationship with a Spanish company or the acquisition of director status (with less than 25% of the share capital) has been contemplated. However, from now on, it will also be allowed in the case of an employment relationship with a foreign company to be provided remotely (teleworking) in Spain. This new system is designed for digital nomads.

Furthermore, it will allow access to all administrators of Spanish companies, regardless of the participation of the share capital. If the company has the status of a holding company, then the text of the regulations requires the participation of less than 25% of the share capital.

It also contemplates performing an economic activity in Spain qualified as an entrepreneurial activity, that is, in aim of the innovation with particular economic interest for Spain and for those who carry out an activity by a highly qualified professional who provides services to companies or carries out training activities, R+D+I (Research and Development and Innovation) may also be eligible.

In addition, the new legislation extends the special tax regime to the spouse and children under 25 years of age (or of any age if they are people with disabilities) displaced with the taxpayer or later (if it occurs during the first year of residence of the taxpayer).

Finally, it is essential to know that there is a 6-month period to apply for the special tax regime since the registration date at the Spanish Social security system.

In light of the above, taking into account the whole new Beckham Law for Digital Nomads, if you are interested in coming to Spain from 2023 onwards, we strongly recommend contacting us to apply successfully for this special tax regime.