Thanks to the approval of the new Startups Law, the aim is to help the formation of companies and attract international talent, improving also the conditions of application of the special tax regime known as the Beckham Law for workers who have been displaced to Spanish territory.
So, if you are already under this special regime you may be wondering how to save on taxes with the Beckham Law. Here we tell you all about it!
What will the new Beckham Law 2023 be like?
The Beckham Law is a tax regime that allows expats to pay much lower taxes.
This modification will allow workers who reside abroad and wish to work in Spain, to pay their real estate and income taxes as if they were non-residents for the first 6 years.
What changes will there be?
The main changes for this new regime are the following:
- Extension of the duration of this regime for applicants from a maximum of 6 to 11 years
- The scope of application of this regime is extended to the spouse of the posted worker and includes children under 25 years of age or disabled.
- The number of years in which the person must not have been considered a tax resident prior to their arrival in Spain is reduced from 10 to 5.
- The administrators of entities regardless of their shareholding also benefit. If they belong to an asset-holding company, a shareholding of less than 25% of the capital stock will be requested.
- Highly qualified professionals performing training activities and providing services to companies will also benefit from these changes.
Beckham Law Tax Advantages
In addition to benefiting when declaring their Personal Income Tax (IRPF). There are taxes that will also be decreased with these new changes:
Inheritance and Gift Tax
This is also included in the inheritance and gift tax and you are considered a resident.
Capital Gains
On the other hand, capital gains are not exempted, this is because the profits obtained from dividends or from the sale of real estate or personal property will obtain a single rate of 19%.
Note: Capital gains obtained outside Spain will have to be paid to the corresponding country according to its tax regulations.
Property Tax
This property tax will only apply to real estate owned in Spain.
Worldwide Income Tax
The applicant will not be obliged to pay for their income obtained worldwide, they will only be taxed for the income generated in Spain.
Who will benefit from these new Beckham Law Tax rules?
- Foreign workers who have just moved to Spain.
- Expats with high income who occupy executive or managerial positions.
- Administrators coming to work in a Spanish company.
However, this rule will not apply to the following people:
- Self-employed workers.
- Professional sports athletes.
- Directors of commercial entities.
Requirements for the Beckham Law
These are the requirements that you must take into account when you want to apply for this special regime:
- The expat has not resided in Spain for the last 5 years.
- The foreigner must have an employment contract.
- This work contract must be signed with a Spanish company.
- For people coming to Spain to work as administrators, they cannot own more than 24% of the company for the law to be applicable and thus benefit from tax savings.
- The core of the employees’ professional activity must be in Spain. However, it is possible to obtain work and income from abroad, as long as it does not represent more than 15% of the total income.
How to apply for the Beckham Law in Spain?
- The application must be submitted within 6 months from the date on which the applicant is registered with the Social Security as an employee of a Spanish company.
- The application must be notified to the Spanish Tax Agency by means of Form 149.
- Provide your passport and NIE when submitting the application.
- Social Security Number.
- Employment contract with a Spanish company.
If you meet all the requirements, you will be able to apply for it and be benefited for 5 years.
Start to save on taxes with the Beckham Law!
Count on the advice of our experts to clarify all your doubts about the Beckham Law in a free consultation! You can also contact us by filling in our contact form or simply by texting our WhatsApp.
In Entre Trámites we can also manage you application to be under the Beckham Law Special Regime. See more here!
