B Law & Tax
22 January 2024

Tax Advisor: How is the Beckham Law applied?

“The Beckham Law” refers to the special tax regime for foreign workers who establish their tax residence in Spain. Officially known as Decree Law 687/2005, this regime is named after the famous British footballer David Beckham, who was one of the first to benefit from its provisions when he moved to Real Madrid in 2003. 

The main objective of the Beckham Law is to attract highly qualified foreign professionals and individuals with high purchasing power to reside in Spain. This special regime offers significant tax advantages to expatriates, especially in terms of income taxation. Under the Beckham Law, new residents only pay taxes on income generated in Spain, not on their global income. Additionally, there are additional tax reductions and exemptions. 


Requirements to Benefit from the Beckham Law 

The Beckham Law allows self-employed workers who wish to carry out economic activities in Spain to access tax benefits, provided they meet certain requirements. 

The main requirement is not to have been a resident in Spain during the five years prior to the relocation. Additionally, they must meet at least one of these three requirements: acquire the status of administrators of an entity, start an entrepreneurial activity in the country, or engage in economic activities as highly qualified professionals. 

This regime also applies to newly relocated foreign workers, expatriates with significant income in managerial or executive roles, and administrators who come to work in a company. 


Benefits of the Beckham Law 

Individuals who meet the requirements to apply for the special regime of the Beckham Law will experience tax advantages during the fiscal year in which they change their residence and the following five years. These benefits will be reflected when fulfilling tax obligations under the Non-Resident Income Tax (IRNR), which offers more favorable rates for high incomes. 

Starting in 2023, family members who move simultaneously or subsequently to the main taxpayer and who have not been residents in Spain in the five previous tax periods can also benefit from this regime. However, this option is conditioned on the sum of the taxable bases in each fiscal period under this regime being lower than the taxable base of the main taxpayer they accompany. 

To enjoy the benefits of the Beckham Law, it is necessary to inform the Tax Agency by submitting form 149 within a maximum period of six months from the start of the activity or entry into Spanish territory. 


Digital Nomads 

As of 2023, the regulations of the Special Regime for workers relocated to Spain extend to digital nomads, who work remotely from anywhere in the world. This change provides freelancers who work as digital nomads the opportunity to benefit from the tax provisions of the Beckham Law when relocating their residence to Spain. The only requirement for these freelancers is to demonstrate that they carry out international telecommuting activities by managing the corresponding visa. 



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