The Beckham Law, or the special tax regime for workers posted to Spanish territory, has undergone several modifications with the so-called Startups Law in order to attract from abroad those entrepreneurs and talents who want to develop their practical function in Spain.
To put in context, it is important to remember that the Beckham Law is one that allows an individual who meets certain requirements to acquire tax residency in Spain, paying taxes only on income obtained in the Spanish territory with the exception of employment income that is taxed in full. This employment income is taxed at a lower rate than in the general Personal Income Tax regime. This means that income obtained from dividends or capital gains abroad is not subject to tax in Spain.
The modifications to the impatriate regime derived from the Startups Law are based on the reduction of the tax periods in which tax residence has been held outside Spain (from 10 to 5 periods) and the insertion of new workers who can avail themselves of this regime.
Apart from those who arrive in Spain with an employment contract, other people will also be able to enjoy the benefits of the Beckham Law:
– Those who are considered as entrepreneurs, who carry out an innovative activity of economic interest for the country, as long as they have a report issued by ENISA.
– Digital nomads, who develop their work telematically and have the international telework visa.
– Highly qualified people displaced due to the realization of an economic activity in Spain, working for emerging companies. One of the requirements to be fulfilled for this sector is that they receive more than 40% of the total income obtained from the work activity.
– The impatriate regime also extends to the spouse and children under 25 years of age or disabled of the taxpayer. Several requirements must be metas having moved to Spain before the expiration of the first tax period in which the Beckham Law applies; acquiring tax residence in Spain; not having had tax residence in Spain during the five tax periods prior to the move; not generating income deemed to have been obtained through a permanent establishment in Spain; and having a taxable income lower than that of the taxpayer in the tax periods in which the impatriate regime applies.
In addition to the above, for those moving to Spain to become administrators of a Spanish company, the previously established limitation as to their percentage of participation in the capital is eliminated, except in the case of patrimonial entities. Previously all them were required to have a shareholding of less than 25%.
To be in line with the extension of the regime to entrepreneurs and highly qualified workers working for a startup, income from economic activities derived from such activities will be considered as income obtained in Spain.
B Law & Tax International Tax & Legal Advisors.
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