Beckham Law Spain: TAX-FREE Life in Spain

It’s no surprise that Spain is one of the favorite countries for British and German nationals.

In this article, we even highlighted it as an interesting country for compliance, because Spain is among the places where having a permanently available home doesn’t automatically make you tax liable (unlike in Germany, where your main residence or “key of power” is decisive).

It’s no secret that many digital nomads in Spain push their 182-day stay in Spain to the limit—or even exceed it. Spanish authorities aren’t known for being particularly strict, as long as no children attend local schools. However, anyone wanting to legally spend more than half a year in Spain with peace of mind will face even worse tax conditions than in Germany. Luckily, there is a solution—and in 2023 it became significantly more attractive.

For many, life in Europe—especially in Spain—is a dream. There’s little doubt that Spain (at least for now) still offers much better safety and infrastructure than countries in Latin America or Africa.

Many people leave Germany with the genuine intention of making Spain their permanent home, not least due to the proximity and ties to the EU. It offers a very pleasant climate: hot summers, mild winters, and lots and lots of sunshine—far from what’s found in England, Ireland, or Scandinavia. That’s why today we’ll analyze the opportunities Spain offers to foreigners.

Deregistration, Many Paths

These kind of movements have become very popular over the last few years:

Europeans: Considering emigration to the Americas, Africa, or Asia for various reasons—they see these places as freer and less shaped by progressive or state ideologies. A key motive is taxes, but it’s not everything. They also note growing restrictions in Europe, especially the EU. Their motivations are varied: seeking new economic opportunities, lower living costs, a milder winter climate, or simply a life they find less regulated and bureaucratic.
Non-Europeans, often from Latin America: Tired of instability and chaos, they dream of emigrating to Europe to start anew. Many factors drive them: education and job opportunities are a big incentive. Spain is often their destination of choice—not only for the shared language but also because of the appealing climate and lifestyle. Taxes aside, that last point is a decisive motivation for many of our clients.

So, we want to show you a solution how you can live in a tax-heavy country like Spain with all its benefits, but still reduce the tax as much as possible.

Beckham Law: The Expat Tax in Spain

Introduced in 2005, the law—officially part of Article 93 of the Income Tax Act—was nicknamed after footballer David Beckham, who was one of the first to benefit. It was designed to attract foreign workers by allowing them to be taxed only on income earned in Spain—not on foreign income.

Today, non-footballers can also benefit. The regime is open to anyone moving to Spain, regardless of nationality, including Spanish nationals, EU citizens, and non-EU nationals—if they meet the requirements.

Requirements:

The requirements are the following:

Tax residency: You must not have been a tax resident in Spain for the past five years (previously ten), and you must be able to prove this if needed. Spain’s Startup Law (Law 28/2022 of December 21) cut the required non-residency period in half and opened the door to remote workers, entrepreneurs, and professionals—including spouses and children under 25.
Reason for moving: Must be work-related, such as:
- A contract with a Spanish employer or a posting from abroad (remote work allowed, especially under the Digital Nomad Visa).
- Administrative duties for a Spanish company, including a company you own (no minimum share requirement anymore).
- Entrepreneurial activities in line with Spain’s Startup Act (Article 70 of Law 14/2013).
- High-skilled professionals working for startups or in R&D, where such work comprises at least 40% of total income.
No income from a permanent establishment in Spain, unless under entrepreneurial or qualified professional activity.

For Germans or EU citizens, the simplest path is as a director or employee of a Spanish company—even if you’re the only owner—as long as it isn’t a holding company. However, your work must justify your relocation. “Just being self-employed” may not suffice unless approved by ENISA (a government agency supporting startups).

Non-EU citizens: the expatriate tax regime is likely your best route—provided you shift entirely to remote work and ideally have a Digital Nomad Visa. While EU citizens cannot get a Digital Nomad Visa themselves, non-EU spouses can—and then both can benefit under the Beckham Law.

Beckham Law: Advantages

Benefit lasts six years (the year of arrival plus five more).
You’re treated as a tax resident in Spain but taxed only on Spanish-source income, similar to a non-resident—foreign income is not taxed.
Work income (national and international) is taxed under Spanish payroll regulations—location of work matters.
Savings, capital gains, and dividends are only taxed if generated in Spain.
Flat tax rate of 24% on the first €600,000 of income (compared to up to 47% normally); income above €600,000 is taxed at 47%.
Spanish-source capital gains etc. are taxed normally at 19–28%.
Foreign real estate investments, dividends, profit withdrawals, or foreign business income are tax-free—provided the performance is outside Spain.
Self-employed remote providers delivering services from outside Spain can use it too—if clearly demonstrated that the work occurs abroad.

Disadvantages

Social security contributions still apply for Spain-based work—no exemption or deduction.
Spanish authorities likely won’t issue a tax residency certificate for treaty purposes—you count as a non-resident, hence cannot use Spain’s tax treaties effectively.
You lose many resident benefits—like minimum allowances, expense deductions (children, social security), and exemptions.
You can be expelled from the regime retroactively, effective January 1 of the year in which conditions lapse. Opting out voluntarily must be done between November and December of the previous year.

Beckham Law: Practical Implementation

So, let us suppose you are a British national in Spain and fulfil above requirements.

When you know have an online business in Marketing, IT or other fields that conduct online through a laptop, with the right setup you would not need to pay taxes on your online income.

You can establish a company in a foreign country such as a US LLC or a Hong Kong LLC (where you pay 0% corporate and dividend taxes in those countries), and the money would also not be taxed in Spain under the Beckham law.

If you want more information on how this looks in practice with a Hong Kong LLC and to reduce your taxes to 0%, book a consultation call with our Hong Kong tax accountants.

Read about why other digital nomads around the world have chosen a Hong Kong company as their setup.

Attention:

Some foreign-owned companies such a US LLC strictly speaking do not have dividends – it is called a pass-through income.

In this case, it depends how the Spanish tax government interprets it.

But if it is considered pass-through-income (instead of dividends), it would be then taxed a flat rate of 24%.

A Hong Kong company on the other hand has by law dividends that can be proved to the Spanish government by the annual tax filings.

Read about the differences between a US LLC and a Hong Kong LLC for paying yourself out.

Beckham Law: Step-by-Step

To benefit:

Travel to Spain with your work contract already in place.
Establish legal residence (over 183 days or primary home)—EU citizens usually have it easier; non-EU need a visa.
Obtain an NIE (foreigner ID number).
Apply for Beckham regime using Form 149 within six months of starting work and social insurance registration.
Submit documentation proving employment and start date.
Receive confirmation from tax authorities (within ~10 working days).
File taxes using Form 151 to declare use of the regime.
Enjoy tax advantages.

Denial can occur if you fail to meet residency, move reasons, NIE, or timely application, and in case of tax evasion or non-compliance.

Beckham Law: Digital Nomad Visa in Spain

Not relevant for EU citizens (freedom of movement), but valuable for non-EU:

For remote workers (employees or self-employed) working via computer for non-Spanish entities. Self-employed may earn up to 20% from Spanish clients.
Granted for one year and renewable, based on financial status and eligibility.
Eligible for main applicant’s family members, with additional financial requirements.
Time spent under this visa counts toward citizenship (2 years for those from Latin America, Philippines, Andorra, Portugal; 10 years for others; 1 year if married to a Spaniard or child born in Spain).
Once on the Nomad Visa, you can apply for the Expatriate Regime.

Additional visas include:

Golden Visa, via €500,000 property investment.
Work visa via a Spanish job offer.

Application process: fill form, compile passport, police certificate, health insurance proof, income proof (at least 200 % of Spanish minimum wage), appointment at consulate or immigration office.

Beckham Law: Spanish Citizenship

Citizens of Latin America, Andorra, the Philippines, and Portugal can apply after just 2 years of legal residence.
Other non-EU nationals need ten years—unless married to a Spaniard or having a child born in Spain (only 1 year).
Time under Beckham Regime, Nomad Visa, or other permits counts towards citizenship.
For EU citizens, a Spanish passport offers fewer perks—but for Latin Americans, it opens access to live and work across Europe.
Be careful: leaving Spain to a tax haven may trigger continued tax liability for years under Spanish exit tax rules.

Beckham Law: Quick Facts

Exit tax years count time under Expatriate Regime.
Only Spanish-source capital gains and savings are taxable; it’s the place of performance that counts.
No need to file Form 720 (foreign assets), and no wealth tax on foreign assets.
No access to Spain’s double-taxation treaties.
You can manage an LLC abroad (non-manager), perform work offshore, and avoid tax.
Provided you meet and document conditions, the 2023 reforms make the regime much more legally secure.
Family benefits apply (spouse and children under 25).
Must apply within six months of social security registration.
Regime lasts five years plus the year of application (six total).
Unemployment doesn’t terminate benefits if you can still prove the professional motive for your move.

Beckham Law: How to MASSIVELY reduce your taxes in Spain – With this one law!

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