What residency is and when you are a resident in Spain
Residency is the link that determines which country you pay tax in on your worldwide income. It does not depend on your nationality or where your company is registered, but on where you actually live and where your centre of economic interests is.
In Spain, the tax authority considers you a tax resident if you meet any of these criteria:
Key points
- Spending more than 183 days a year in Spanish territory.
- Having the main centre or base of your economic activities in Spain.
- Having your spouse, not legally separated, or your dependent minor children in Spain, unless proven otherwise.
Why residency matters if you open a company abroad
If you are a tax resident in Spain, you pay tax here on your worldwide income: salaries, dividends, rents or capital gains generated in any country. That is why opening a company in Portugal, Andorra or Dubai does not by itself remove your obligation to declare in Spain if you continue to live here.
To avoid paying twice on the same income, Spain has signed double taxation treaties with most European countries. The key is to plan the structure before invoicing, not after.
Before choosing a destination, it is worth comparing taxation and real costs. We cover this in our guide on where to open a company in Europe and in the double taxation treaty between Spain and Portugal.
The Beckham Law: the special impatriate regime
The Beckham Law (special impatriate regime, article 93 of the Personal Income Tax Law) allows new tax residents to be taxed as non-residents during their first years in Spain. Instead of the progressive personal income tax scale, which reaches up to 47%, they pay a flat rate of 24% on their employment income obtained in Spain.
The great advantage is that, while it is in force, they only pay tax on income generated in Spanish territory, not on their worldwide income. Foreign income — dividends, interest or capital gains — is outside Spanish personal income tax while the regime lasts.
Key points
- Flat rate of 24% on employment income up to €600,000 per year.
- Rate of 47% on the excess above €600,000.
- Duration: 6 years (the year of arrival plus the following 5).
Requirements to qualify for the Beckham Law
To access the regime you must meet several requirements: you must not have been a tax resident in Spain in the previous 5 years, you must relocate under an employment contract or to serve as a company director, and you must apply for the regime within 6 months of registering with Social Security.
Since 2023, remote workers and digital nomads can also qualify, as well as directors who do not hold a stake of more than 25% in the company (or who meet the requirements of the startup law).
Key points
- Not having been a tax resident in Spain in the previous 5 years.
- Relocating under an employment contract or appointment as a director.
- Filing form 149 within the first 6 months from registration.
Beckham Law and entrepreneurs: what you should keep in mind
If your plan is to open a company in Spain or abroad and run it from here, the Beckham Law can change the calculation. A relocated director or executive pays 24% on their Spanish salary and excludes income from their foreign companies as long as it is not distributed as employment income.
Note: income from economic activities carried out in Spain does not benefit from the flat rate. If you invoice as a self-employed person or through a Spanish company with local activity, you will be taxed under the general personal income tax scale.
That is why it is advisable to combine residency with a coherent corporate structure. If you are going to operate in Europe, review how to open a company in Portugal or the advantages of a holding company in Portugal.
