Author: Maria Plotnikova
Attorney, Family Office
Concept
The Beckham Law is a special Spanish tax regime created in 2004 and named after footballer David Beckham one of its first beneficiaries. The regime was designed to attract highly qualified foreign specialists and talented professionals to Spain.
The essence of the concept lies in the fact that foreigners relocating to Spain for work may opt for "non-tax resident" status (Spanish — “impatriados”) while physically residing in the country. This allows them to pay a fixed income tax rate only on income earned in Spain and excludes taxation on foreign income.
Advantages
Tax rate on foreign passive income:
- 0% on dividends, interest from loans, royalties and income from sale of shares (regardless of amount).
Tax rate on employment income:
- 24% up to €600,000 per year;
- 47% above €600,000.
Social contributions:
- in 2024, minimum €230, maximum €542;
- in 2025, minimum €200, maximum €590.
The amount of social security contributions is calculated based on the taxpayer's age, type of activity and income level.
In Spain the maximum amount of social contributions is €14,000 per year. Social contributions may be paid in the employer’s country (e.g., Russia).
Disadvantages
- no right to tax deductions
- double taxation treaties do not apply (withholding tax at source may arise)
Conditions
To apply the Beckham Law one must hold one of the following statuses:
- manager of an active company in Spain (or passive company if control is <25%)
- Digital Nomad working for a foreign company under an employment contract
N.B.: Digital Nomads working as sole proprietors (“autónomo”) are not eligible under the Beckham Law (art. 93.1. Reglamento IRPF).
- startup entrepreneur (“Start-Up empresas emergentes”), in accordance with Article 70 of Law 14/2013, of 27 September, on Support for Entrepreneurs and their Internationalisation.
N.B.: A mandatory requirement is an informe from ENISA (art. 93.b.3 IRPF);
- family members of a person to whom the Beckham Law applies (Art. 93.3 LIRPF as amended by Law 28/2022).
The spouse of the taxpayer and their children under 25 (no age limit in case of disability) may benefit from the Beckham Law. If there is no registered marriage the presence of a mutual child is sufficient.
The income of the spouse and/or children must not exceed the income of the primary applicant.
However:
Individuals who have been Spanish tax residents during the previous 5 years cannot use the Beckham Law.
Likewise, individuals who derive income from a permanent establishment located in Spain cannot apply this special regime.
Grounds for refusal
- Failure to meet the non-residency condition during the previous 5 years;
- Belonging to a group ineligible for the regime;
- Failure to submit the application within the deadline (6 months).
For those who became Spanish tax residents in 2023 a transitional period applies, during which the 6-month term begins on the date the new tax form became available, i.e., from 15/12/2023.
For spouses and/or children the 6-month term starts from the moment of arrival in Spain.
Applying the Beckham Law
To start benefiting from the Beckham Law one must first complete Form 030 to register as a tax resident and obtain a tax identification number (NIE). Then one must notify the Spanish tax agency of the intention to apply the special tax regime by submitting an application via Form 149.
The form must also include the following documents:
- Passport and NIE
- Social Security number
- Employment contract (this document does not need to specify the place of work in Spain (centro de trabajo), unlike the document for employees on assignment).
Every year between April and June persons subject to the Beckham Law must file an income tax declaration using Form 151.
Related links:
Strategy: Beckham Law + Hong Kong
Spain — Residence Permit Digital Nomad
Contact Information
If you have any questions or require a consultation, our experts will be happy to assist you.
Private.law Attorneys
This material is provided for public informational purposes and is freely shareable.
We specialise in solving complex legal challenges for discerning clients. 🍓