WHAT IS THE BECKHAM LAW?

We live in an era in which the world is increasingly internationalised and companies tend to look for business beyond their borders.

Sometimes this causes the impatriation of workers, that is, the hiring of workers from other countries.

These displaced workers’ tax treatment will vary depending on the country where they will stay.

A SPECIAL REGIME FOR WORKERS RELOCATED TO SPAIN

The purpose of the BECKHAM LAW is to attract highly qualified personnel to improve the internationalisation and competitiveness of Spanish companies.

Impatriates may choose to pay taxes for the special regime when they acquire their fiscal residence in Spain as a result of their displacement.

Many clients of the Pérez Parras Economists & Lawyers Firm in Málaga and Nerja are displaced workers and entrepreneurs from the European Union who want to invest in Spain.

Throughout this article, we will answer questions they raised about the option to pay taxes under the BECKHAM LAW regime. We enclose an informative link from the Spanish Tax Agency about this special regime.

Employees relocated to Spain

FACTORS TO TAKE INTO ACCOUNT BEFORE OPTING TO PAY TAX UNDER THIS LAW:

  • What is the advantage of opting for the BECKHAM LAW taxation?

This Law allows a fixed tax rate of 24% for the first 600,000.00€ income obtained from work on Spanish territory, and 45% on the remainder from that amount.

The tax rate for dividends, interest and capital gains ranges from 19% to 23%.

The Beckham Law brings advantages

  • What requirements must I meet to qualify for the BECKHAM LAW?

The taxpayer who wishes to pay taxes under the BECKHAM LAW regime must meet the following requirements:

  1. Not having been a tax resident in Spain 10 tax years prior to the Spanish relocation
  2. That the displacement to Spain occurs as a result of an employment contract, an international assignment or because the status of administrator of an entity has been acquired
  3.  Not getting income that would be classified as obtained by permanent establishment located in Spain

How and when to apply for the BECKHAM LAW?

In general, the deadline to request the application of the scheme is 6 months from the date of registration in Social Security and is done through model 149.

The special regime will be applied during the first six years of tax residence in Spain.

All the same, there are more factors to consider:

Can you can waive the Beckham Law if it is not appropriate?

Will you invest in Spanish companies?

Are spouses and children able to opt for the BECKHAM LAW taxation? etc…

However, each case is particular. Before making the decision to pay taxes under this regime, you should consult an expert in the field.

Finally, if you want to invest in Spain, if you are a displaced worker, or if you are simply under this special regime and you do not know whether you are being taxed correctly or not, our Firm Pérez Parras Economists and Lawyers, in Malaga & Nerja consists of experts in tax laws. We will help you solve all your problems. Come and discuss your concerns with us without obligation.