B Law & Tax
18 December 2023

Tax Advisor: Beneficial Taxation: Approval of Form 151 and Updates to the Beckham Law and Startup

The Ministry of Finance has approved the newly created Form 151, providing foreign employees with the opportunity to benefit from the Beckham Law, a special tax regime designed for those who have returned to the country.

 

Expanding Tax Benefits: Attracting Talent with the Startup Law

In order to encourage talent attraction, the Startup Law has introduced additional profiles that could benefit from this more favorable tax regime. Among them are telecommuters, entrepreneurs, highly qualified professionals providing services in startups, as well as those engaged in specific activities related to training, research, development, and innovation. Moreover, this system also allows close family members, such as spouses and children under 25 years old (or of any age in case of disability), to be subject to taxation under its benefits.

 

Retroactivity in the Beckham Law for Foreign Workers in Spain

Additionally, the Order approved by the Treasury, published this Friday in the BOE, establishes that workers who move to Spain in 2022 or 2023 to start their activities this year will also have the possibility to benefit from the Beckham Law with retroactive effect, granting them a six-month period. This way, the Administration addresses the legal gap created by the Startup Law, enacted at the end of 2022, which opened the door to their arrival. However, the Treasury did not develop the regulations or the necessary form for them to take advantage of this special tax regime, leaving them in an undefined fiscal situation.

The Beckham Law allows these taxpayers to be taxed through the Non-Resident Income Tax (IRNR) instead of the Personal Income Tax (IRPF), with a fixed rate of 24% for incomes up to 600,000 euros and 47% for gains exceeding this threshold. They can remain in this regime as long as they have spent a period of five years outside Spain before applying for it and, once in the country, during the year of their return and the following five years.

 

Form 151 : In summary

The Ministry of Finance has approved Form 151 to allow foreign employees to benefit from the Beckham Law upon returning to Spain. The Startup Law extends tax benefits to profiles such as telecommuters, entrepreneurs, and qualified professionals, including family members. In addition, a recent Order establishes the retroactivity of the Beckham Law for foreign workers who relocated in 2022 or 2023, addressing a legal gap created by the 2022 Startup Law. The Beckham Law allows taxation under the Non-Resident Income Tax (IRNR), with rates of 24% for incomes up to 600,000 euros and 47% for higher gains, provided they spend five years outside Spain.

 

 

 

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