Carried interest and the Beckham Law in Spain
Carried interest can raise tax questions when you move to Spain under the Beckham Law. For private equity and investment fund professionals, carried interest may become payable years after the work that generated it. What happens if you receive it while Spain’s Beckham Law applies?
The answer depends on the facts. In a specific ruling, the Spanish Directorate-General for Taxation considered an incentive that related entirely to work performed before the move. It concluded that the payment was not subject to Spanish tax to the extent that it did not arise directly or indirectly from personal activity performed in Spain. That conclusion does not mean that all foreign carried interest is automatically outside Spanish tax.
At Pérez Parras Economists & Lawyers, we assess eligibility for the Beckham Law and advise on international compensation, taking the terms of each client’s incentive plan into account.
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Why carried interest raises questions when you move to Spain
Carried interest is compensation usually linked to the performance of investments managed by a fund. Depending on the plan, a professional may receive it long after participating in the transactions that helped generate it.
Between the initial work and the payment, your country of residence, employer and responsibilities may have changed. Plans also differ: some include vesting periods or continued-service conditions, while others reward different activities or several stages of a professional career.
The payment date or the location of the transfer alone does not determine the Spanish tax treatment. It is necessary to understand what each amount rewards and how it relates to the work actually performed.
Carried interest earned before moving: the Spanish tax authority’s view
In binding ruling V5374-26 of 28 July 2026, the Directorate-General for Taxation examined the position of a professional working in London for an international fund manager who planned to move to Spain to work for a group company.
According to the facts submitted, the points giving rise to the carried interest were allocated transaction by transaction before the move. Once allocated, the entitlement was vested under the terms described in the plan. The amount and payment would be determined later, after divestment. According to the applicant, no active work relating to the investment was performed afterwards, apart from the monitoring described in the ruling.
The tax authority assumed that the carried interest would be allocated to a tax year in which the special regime applied. On that basis, it regarded the income as arising entirely from work performed before relocation. It concluded that the income would not be subject to Spanish tax to the extent that it did not arise directly or indirectly from personal activity performed in Spain.
The ruling also makes access to the regime conditional on the legal requirements and, on the stated facts, on the individual becoming Spanish tax resident in 2027. This is an administrative response to a specific fact pattern; other plans require their own assessment.
Read ruling V5374-26 in the official tax rulings database
Carried interest and the Beckham Law: what can change the result?
Two professionals with similarly named incentives may face different outcomes. Relevant factors include the rights granted under the plan, the period to which the compensation relates and the activities actually carried out in each country.
It is also necessary to consider whether the professional continued to perform investment-related functions after arriving in Spain, how any vesting conditions operate and the tax year to which the income is allocated. A foreign entity in the structure does not resolve those questions on its own.
The review should take account of whether the special regime applies, how the income is classified and, where relevant, the rules of the country of origin and the applicable double taxation treaty. Not every payment under an investment plan necessarily receives the same treatment.
Whether you already benefit from the Beckham Law or are considering a move, an early review can help you understand your position before making decisions based on assumptions that may not fit your circumstances.
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Is carried interest the same as selling foreign shares?
Not necessarily. A share sale and a work-related incentive can give rise to different types of income. Their tax treatment depends on the actual transaction and the rules applicable to it. Read our article on the sale of foreign shares under the Beckham Law.
Carried interest may also raise some of the same questions as other deferred compensation, although the contractual terms can be different. If you expect other deferred payments, read our guide to foreign deferred compensation under the Beckham Law.
Carried interest: frequently asked questions
Is all carried interest received after moving to Spain taxable there?
There is no universal answer. In ruling V5374-26, the tax authority concluded that the incentive was not subject to Spanish tax on the stated facts, to the extent that it did not arise directly or indirectly from personal activity performed in Spain. Different facts may lead to a different result.
Is it enough that the fund or payer is outside Spain?
No. The fund’s or payer’s location is relevant to the wider analysis, but it does not by itself determine where the income is sourced or how it is taxed.
What if I perform some work relating to the incentive in Spain?
The plan and the actual activities require individual review. The ruling concerned an incentive arising entirely from work performed before the move, without a direct or indirect connection to personal activity in Spain. Its conclusion should not automatically be applied to different facts.
Can a fund professional use the Beckham Law?
It may be possible if the legal conditions are met. An international employer or fund does not automatically establish eligibility. The reason for the move, professional relationship, residence and other requirements must be considered individually.
Advice for international fund professionals
Pérez Parras Economists & Lawyers helps international professionals assess their eligibility for the Beckham Law and the treatment of their remuneration, including variable and deferred incentives. We review the client’s circumstances and coordinate the Spanish analysis with relevant international tax questions.
If you are planning a relocation or already live in Spain and expect to receive carried interest, our team can help you assess the implications.
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