BackThe Beckham Law is a favorable tax regime aimed at foreigners who move to live in Spain, known as “expatriates.” This regime was introduced by Royal Decree 687/2005, which amended the Personal Income Tax Law (IRPF).
Under this regime, beneficiaries are taxed according to the Non-Resident Income Tax (IRNR) for the first six tax periods. Taxation is applied at a fixed rate of 24% on income earned in Spain up to 600,000 euros and 47% on income above that amount. The main objective of this regulation is to attract highly skilled workers to the country.
The regime is named after the footballer David Beckham, who was one of the first to benefit from this law. It is worth noting that the Beckham Law has undergone substantial modifications with Law 28/2022, dated December 22, aimed at promoting the startup ecosystem.
Requirements to Opt into the Beckham Law
Prior Residency:
Not having resided in Spain during the five years prior to moving to Spanish territory.
Reasons for the Move:
The move to Spanish territory must be due to:
An employment contract, except for professional athletes (this includes employees who move to Spain to work remotely).
The acquisition of the status of administrator of a startup, provided the entity is not an asset-holding entity and the administrator does not hold a stake equal to or greater than 25%.
Conducting an economic activity in Spain classified as entrepreneurial (understood as an innovative activity and/or of special economic interest to Spain, with a favorable report issued by Empresa Nacional de Innovación S.A.).
Conducting an economic activity in Spain by a highly qualified professional providing services to startups or engaging in training or R&D activities, receiving compensation that represents more than 40% of their business, professional, and personal work income.
Income Earned:
Not earning income through a permanent establishment located in Spain, except in cases of entrepreneurial activities or activities performed by highly qualified professionals.
Possibility of Opting In for the Taxpayer’s Relatives
The following relatives of the taxpayer may opt into the Beckham Law, meeting certain requirements:
Children under 25 years old or disabled.
Spouse or parent of the children if there is no marital relationship.
Requirements for Relatives:
They must move to Spain with the taxpayer or later, but before the end of the first tax period in which the regime applies to the taxpayer.
They must acquire fiscal residency in Spain.
They must not have resided in Spain during the five years prior to the move.
They must not earn income through a permanent establishment in Spain, except in cases of entrepreneurial activities or activities performed by highly qualified professionals.
The sum of the taxable bases of the taxpayers in each of the tax periods in which the special regime applies must be less than the taxable base of the taxpayer they accompany.
Procedure to Opt into the Beckham Law
Application:
An application must be submitted to the Tax Agency using form 149, within six months from the start date of the activity as indicated in the Social Security registration.
Procedure to Opt Out of the Beckham Law
Opting Out:
Opting out of the regime must be done during the months of November and December for it to be effective from January of the following year. Once opted out, it is not possible to reapply for this regime.
B Law & Tax International Tax & Legal Advisors.
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