A Spanish non resident tax law

This article is about our soft landing services in combination with the application of Beckham´s law in Spain. In 2005 Spain adopted the Beckham law. Its purpose was to offer a mild tax climate to attract talented and highly skilled foreign physical persons in order to further internationalize and increase competitiveness of Spanish companies. The law got its nick name after David Beckham who transferred in 2003 from Manchester United in England to go and play for Real Madrid in Spain. His transfer fee amounted to 37,5 million Euro and his salary was said to be 17 million GBP per year. He was supposedly one of the first to apply for this special tax regime and benefit from it.

Eligibility

To be eligible for its application one needs to comply with the following:

• Haven´t been a resident in Spain during the 10 years previous to application;
• The application needs to be filed within 6 months after being registered with the Spanish social security or, within the same time frame, proof of being kept in the social security of the country of origin;
• The “transfer” to Spain is the result of an employment contract (which can be an assignment) or the appointment as a director (an administrator) of a company;
• The person doesn’t obtain income from a permanent establishment (a permanent establishment being defined here) ;
• The regimen is applicable for a maximum of 5 years on top of the year of fiscal establishment in Spain (so 6 years in total).

Tax Percentage and Taxable Income

The rate is a flat 24% of the taxable income through employment for the first €600,000 (after that 45%) and between 19 and 23% for dividends and capital gains.

Soft Landing Services

We can help you determine whether you or your employee might be eligible for the Beckham regime. It is part of our soft landing services (legal, admin/ tax and payroll) and often very well received by our Clients.

Contact

If you would like further information or help with a soft landing and Beckham´s law in Spain, please do send us a note or call us directly at 0034 610 739 364. If you need help with any other business services, feel free to ask.

“Caminito del Rey” Málaga province