Spain: the Beckham Law extended to remote workers

Spain's regime for posted workers allows a person who moves their residence to Spain to be taxed under the rules applicable to non-residents, that is, only on their Spanish-source income.

The applicable rate is 24%¹ up to a taxable base threshold, set at €600,000², above which a higher rate applies.

The regime lasts 6 years³: the year of the move and the following five. It is therefore limited in time and cannot be renewed.

The comparison with the general schedule is telling: it reaches 47%⁴ at its top marginal rate, to which the regional (autonomous community) portion is added. The difference is considerable for a high salary.

It should be noted from the outset what this regime is not. It is neither an exemption nor a flat tax: the beneficiary remains a Spanish tax resident and files in Spain, but under the rules applicable to non-residents. This technical classification governs everything else, in particular the base for wealth taxation.

The regime was originally designed for employees posted to Spain by a foreign company. Its extension now covers employees who work remotely from Spain for a foreign employer, as well as certain profiles of company directors and entrepreneurs.

The prior non-residence requirement has also been reduced, which opens the scheme to people who left Spain more recently.

The main limit remains: the regime covers only earned income and leaves foreign-source passive income outside the Spanish tax base, but it does not exempt beneficiaries from reporting obligations or from wealth taxation.

The solidarity tax on large fortunes, in particular, applies to wealth above more than €3,000,000⁵. A beneficiary of the regime, however, is only subject to it on assets located in Spain, which considerably reduces its base for the duration of the scheme.

We do not publish the number of years of non-residence now required, the exact list of eligible profiles after the extension or the rate applicable above the threshold: we were unable to verify them in an up-to-date official Spanish source. They must be confirmed with the Agencia Tributaria.

1. Check the eligibility of the profile: posted employee, remote worker for a foreign employer, director or entrepreneur, as the case may be.
2. File the election within the prescribed period after acquiring Spanish tax residency: the regime does not apply automatically.
3. Assess the effect of the 6 years³ time limit: the exit year is when the tax burden changes abruptly.
4. Quantify the regional portion, which varies greatly from one autonomous community to another on leaving the regime.
5. Deal with the departure from France according to its own criteria, as presence of more than more than 183 days⁶ establishes habitual residence in Spain.

The third point is the one most often missing from projections. A professional settled under this regime sees their tax burden jump in the seventh year, even though their salary and lifestyle have been established on the basis of the first six.

The interaction between the regime and remote work for a foreign employer raises a question that the extension does not fully resolve: that of permanent establishment. Work carried out on a lasting basis from Spain may, depending on the circumstances, be regarded as creating a taxable presence for the employer.

This is a risk for the company more than for the employee, but it often determines whether the employer agrees, and it must therefore be addressed with them in advance.

Spain also remains a country with real wealth taxation: a wealth tax devolved to the autonomous communities, a national solidarity tax, and inheritance tax that varies by community. The posted workers regime mitigates their effects without removing them.

For a French national, the conclusion can be summed up in one sentence: the regime makes Spain very competitive on earned income for six years, and much less so on wealth, before and after. The two horizons must be quantified separately.