Special regime for displaced employees, or “The Beckham Law”

Do i qualify? Should i be interested in applying?

The special regime for displaced employees to Spanish territory, or “The Beckham Law”, allows for the taxation with a special –and often more beneficial— tax regime for those moving to Spain for work purposes.

This special regime enables you to pay taxes in Spain as a NON-RESIDENT, even if you are living in Spain permanently.

Main Benefits

√ A flat tax rate of 24% on earned income up to 600,000 euros (47% on income above 600,001 euros).

√ NOT paying tax in Spain on other income or earnings, besides work, that may be obtained abroad: for example, dividends or gains from shares abroad, income from the rental or sale of real estate abroad, etc.

Main Disadvantages

× Impossibility of obtaining a certificate of tax residence in Spain for the application of agreements to avoid double taxation.

× Non-applicability of the exemptions, deductions, and allowances foreseen for tax residents in Spain in the Personal Income Tax Law; exemption for severance pay or maternity/paternity leave, exemption for the main residence owned in Spain, reduction in pension plans, family minimum, regional deductions, etc.

The APPLICATION for the special regime (Beckham Law) must be submitted within 6 months of arrival in Spain or from the start of the employment contract in Spain, whichever is earlier. It is very important to respect this deadline, as tax authorities will reject all applications submitted after the deadline.

This special regime is granted for a period of 6 years, with the possibility of voluntarily resignation from it during November and December, with effect in the following year.

Requirements that must be met

In addition to the application deadline, the requirements are:

1. Not to have been a tax resident in Spain during the 10 financial years prior to the year in which you are moving to Spanish territory.
2. Employment contract in Spain with registration in the Spanish social security system (a contract as a director of a Spanish company with which there are no ties is also accepted).