27 Mar Beckham Law in Spain: What it is, requirements, and how we handle it comprehensively

The high tax burden in Spain constitutes one of the biggest problems faced by professionals, executives and workers who seek to move their residence to Spanish territory.

However, the legal system provides for a tax optimization mechanism, commonly known as the Beckham Law, which allows paying less taxes in Spain for non-residents and foreigners who move to Spanish territory.

The Beckham Law, also called the special regime for expatriates, allows certain taxpayers to be taxed under the Non-Resident Income Tax (IRNR), despite being tax residents in Spain at a fixed rate of 24% up to €600,000, and 47% for higher income. This regime represents significant tax advantages compared to the general Personal Income Tax system, for a significant period of six years (the year of adhesion and the following five tax periods).

This tool is especially relevant in the case of:

• International mobility of workers
• Relocation of executives and qualified profiles
• International Telework (digital nomads)
• Attraction of foreign Talent

Below, we explain who can benefit from the Beckham Law and, especially, how we manage its processing from our firm comprehensively, guaranteeing legal security and maximum probability of success before the AEAT.

Requirements to opt for the Beckham Law

To know who can benefit from the Beckham Law we must refer to a series of varied requirements, provided for in article 93 of the Personal Income Tax Law.

This is not an automatic regime, but quite the opposite, it requires a well-founded legal brief, so that the Administration, which has quite restrictive criteria, accepts the application to each case.

1. Not being a tax resident in Spain.

It does not matter at this point having lived in Spain previously, it is required not to be a taxpayer in Spain at the time of the application.

2. Not having been a resident in Spain in the five previous years.

Notwithstanding the previous section, now it is necessary to consider whether the interested party has been a resident in Spain previously, but for a closed period of 5 years.

3. Relocation for justified cause.

The relocation to Spanish territory must occur as a consequence of some of the causes that appear in numbers first through fourth of section 1.b) of article 93 LIRPF.

This is where the most determining part comes, since the Administration requires that there exists a direct, real and verifiable relationship between the relocation and the alleged cause.

Among the main causes provided for by the regulation are:

• The formalization of an employment contract initiated with an employer in Spain.
• Relocation ordered by the employer and the existence of a transfer letter.
• Work activity that is performed remotely, through the exclusive use of computer, telematic and telecommunication means and systems. In this last case, obtaining an international telework visa significantly strengthens the taxpayer’s position.

Among other causes, relocation to Spanish territory can also be a consequence of acquiring the status of administrator of a Spanish company, carrying out an economic activity qualified as entrepreneurial, or carrying out an economic activity by a highly qualified professional.

We handle everything related to the Beckham Law procedure.

At our firm, we have lawyers specialized in the Beckham Law who have processed numerous applications from relocated workers who wish to benefit from the special regime for expatriates under article 93 LIRPF.

Therefore, our work system is designed so that the client can leave the processing in our hands with the greatest peace of mind, while we, on their behalf, manage the entire process, from the initial analysis to its definitive resolution before the AEAT.

1. Beginning

The process begins with an initial contact with the client, which can be either by telephone call, video call, or in person, in which we analyze in depth the client’s personal, professional and tax situation.

This phase is decisive, since we do not limit ourselves to verifying requirements superficially, but we perform a complete legal analysis of the fit within the Beckham regime, paying special attention to the elements that the AEAT examines with greater rigor.

If the case requires it, we prepare a preliminary viability report, in which we analyze in detail the client’s situation, identify possible risks that might arise and assess which relocation reasons may be more favorable for the client, formulating a founded legal recommendation on the advisability of benefiting from the Beckham Law before initiating the procedure, so that the client can decide.

2. Foundation and application

Once the approach is defined, our lawyers specialized in the Beckham Law prepare a well-founded legal brief, in which we justify the application of the special regime for expatriates with regulatory basis and from an evidentiary perspective, managing on our own all communications with the Administration and monitoring the procedure, while keeping the client duly informed.

Finally, we formalize the application through the submission of form 149 before the AEAT, ensuring that the file reaches the AEAT with a solid, coherent and legally defensible approach from the beginning.

3. Incidents

In case of requirements or incidents by the Tax Agency, we assume complete defense of the file, formulating duly founded technical allegations, providing additional documentation strategically and, when appropriate, filing the corresponding administrative appeals. Our approach is clear: to sustain the application of the Beckham regime with legal rigor in all phases of the procedure.

Contact us

If you are thinking of moving to Spain or have already done so recently, it is essential to analyze your situation before submitting the application. From our firm we offer you personalized advice on the Beckham Law, evaluating the viability of your case and managing the entire procedure comprehensively.

As we have already indicated, at Navarro Llima Abogados we handle the process for multiple clients, therefore, if you have any questions or consider that you also want to benefit from the regime, please contact us at info@navarrollimaabogados.com