Spain’s Beckham’s Law Tax Program
Spain's Beckham's Law Tax Program
Many countries in Europe have special tax regimes that new residents can take advantage of, and one of those is Spain’s Beckham’s Law.
What is Spain’s Beckham Law?
The Beckham Law, officially known as the Non-Resident Income Tax Law, is a Spanish law that was passed in 2005. It was named after the English footballer David Beckham, who was one of the first people to take advantage of the law.
The law allows foreign workers who move to Spain to pay a flat rate of 24% income tax on their earnings up to €600,000, rather than the standard rate of up to 48%. This has made Spain an attractive destination for investors.
Who can apply for Spain’s Beckham Law?
The Beckham Law is available to foreign investors and workers who move to Spain and become tax residents. To qualify, the individual must have lived in Spain for at least 183 days in a calendar year, or have their main economic activity in Spain. The law also applies to foreign workers who are employed by a Spanish company, or who are self-employed in Spain.
Can Golden Visa holders apply to Beckham’s Law?
Yes, Golden Visa holders can apply for the Beckham Law. To qualify, the individual must apply before becoming a resident and then have lived in Spain for at least 183 days in a calendar year, or have their main economic activity in Spain. The law also applies to foreign workers who are employed by a Spanish company, or who are self-employed in Spain.
What are the benefits of Spain’s Beckham Law?
The main benefit of the Beckham Law is that it allows foreign workers to pay a flat rate of 24% income tax on their earnings, rather than the standard rate of up to 45%. This makes Spain an attractive destination for investors and workers, as it can result in significant tax savings. The law also removes the requirement of paying capital gains tax on assets sold outside of Spain.
What is the process for applying to Beckham’s Law?
One must submit an application to Spain’s Tax Authority. After submitting the application, the Spanish Tax Agency will review it within 10 days (although the process can take up to 1-2 months). Upon approval, the individual will receive a certificate that must be presented to their employer in order for them to start applying the 24% tax rate deduction.
Can a person apply to Beckham’s Law before gaining a residence permit?
Yes, a person can apply to the Beckham Law before gaining a residence permit. However, to do so, they must have a resident permit application planned or set in motion. They can also apply for Beckham’s Law after becoming residents but before qualifying as tax residents.
How can I learn more about Beckham’s Law?
The best way to learn more is by contacting the team at Moveanywhere to book a comprehensive consultation that will cover all the basics.
Moveanywhere’s team will analyze your case in terms of your current tax burden, income streams, asset portfolio, potential tax requirements, family composition and possible tax benefits,
and what the best solution is for you. All you need to do is contact us today.