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Moving to Spain means becoming a Spanish tax resident, with tax on your worldwide income at progressive rates. The special regime for impatriates, known as the Beckham Law, can significantly reduce that burden during your first years in the country. Since the Startup Act of 2023, it is available to more people, including digital nomads and entrepreneurs.
What is the Beckham Law?
It is a special tax regime that allows eligible individuals who become Spanish tax residents to be taxed, broadly, as if they were non-residents for the year of arrival and the following five years. In practice:
- Spanish-source employment income is taxed at a flat 24% up to €600,000 per year (47% above that).
- Most foreign-source income is not taxed in Spain, with some exceptions.
- Wealth tax applies only to assets located in Spain.
Who can apply?
The general requirements are:
- Not having been tax resident in Spain during the five years before moving.
- Moving to Spain because of an employment contract with a Spanish company or a posting, remote work under the digital nomad visa, becoming a director of a company (with limits on shareholding in some cases), or carrying out an innovative entrepreneurial activity or highly qualified professional activity for startups.
Spouses and children under 25 can also benefit under certain conditions.
Deadline
The application must be filed within six months of registering with Spanish social security, or of the start date recorded in the corresponding certificate. Missing the deadline means losing the regime.
When is it worth it?
The Beckham Law is especially attractive for:
- High earners, where the flat 24% is much lower than the top progressive rates.
- People with significant foreign investments, dividends or rental income that would otherwise be taxed in Spain.
- People with substantial assets abroad affected by wealth tax.
It may be less attractive for:
- Lower incomes, where the ordinary progressive rates and allowances may result in less tax.
- People who want to apply double taxation treaty benefits, as regime taxpayers have limited access to some of them.
- Families who would benefit from personal and family deductions not available under the regime.
A comparison between the ordinary regime and the Beckham Law should always be made before applying. Our tax lawyers prepare this analysis for new residents.
Digital nomads and the Beckham Law
Holders of the digital nomad visa can apply for the regime, which makes Spain one of the most competitive destinations for remote workers. Combining a well-prepared visa application with tax planning is key. Read more about the digital nomad visa.
Practical steps after arriving
Once you have registered with Spanish social security, calendar the six-month deadline immediately. Gather your employment contract or visa resolution, proof that you were not resident in Spain in the previous five years, and the social security registration document. After the tax authorities approve the regime, you will file a specific annual return instead of the ordinary income tax return. Keep records of any foreign income, as some types may still be taxable in Spain under the regime.
Frequently asked questions
Can I apply if I lived in Spain ten years ago?
Yes, if you were not tax resident in Spain in the five years before moving.
Can freelancers use the Beckham Law?
Self-employed digital nomads and entrepreneurs with innovative activities may qualify under the reformed rules. Each case should be checked.
Can I leave the regime?
Yes, you can waive it, but you cannot re-enter.
Conclusion
The Beckham Law can make relocating to Spain much more tax-efficient, but it is not the best option for everyone. Timing and eligibility are crucial. Castell.law advises new residents in the Balearic Islands on combining immigration and tax planning from day one.
