What is the Beckham regime or impatriate regime?
The Beckham Law or the Special Tax Regime for Impatriates is an optional special tax regime that originated years ago to attract foreign talent to Spain, especially athletes and other high-level professionals.
This regime allows these foreigners who move to live in Spain for work reasons to be taxed as NON residents for a period of 6 years.
Until December 31, 2022 there were a series of requirements to be fulfilled in order to benefit from this regime which were the following:
- Not to have been a resident in Spain during the last ten years.
- The move to Spain occurred as a result of an employee contract or the acquisition of the status of director of a company.
- No income qualified as obtained through a permanent establishment in Spain was obtained.
As you can see, only those who moved for work purposes with an employment contract (employee) could apply for inclusion in the regime; this is different from acquiring the status of self-employed (self-employed).
Regulatory changes from 2023
From January 1, 2023 there were changes regarding this regulation and now it also allows self-employed workers to apply for inclusion in this regime.
We explain below the requirements to be met and the different conditions of this regime.
Who can apply?
Apart from those employees (with an employment contract) that the law already provided that they could apply for inclusion in the regime, we are going to see what are the requirements to apply for such inclusion as a freelancer.
- Application as a freelancer - Requirements
The first thing you must be able to certify is that you have not been a tax resident in Spain during the last five tax years before applying, in other words, if you want to apply in 2024, you must not have been a tax resident here since 2019.
- In what cases can it be requested?
You must relocate in Spanish territory as a result of any of the following circumstances:
- Develop an economic activity in Spain qualified as an entrepreneurial activity.
In this case, you will need a favorable report issued by ENISA in which they grant your project the status of "innovative".
- Develop an economic activity being a highly qualified professional and provide services to emerging companies or start-ups.
You must have documentation accrediting your position as a highly qualified professional or that the residence permit obtained is for this same circumstance according to Article 71 of Law 14/2013 on support for entrepreneurs.
You must also have accreditation of the registration of the company for which you provide the service as an emerging company in the competent Commercial Register or Register of Cooperatives, unless there has been a telematic verification procedure and there is a document accrediting the provision of services to this company.
- Develop economic activities of training, research, development and innovation in Spain.
You will have to provide supporting documentation of the performance of these activities, unless the residence permit is the authorization itself for training, research, development and innovation referred to in Article 72 of Law 14/2013.
In any of these three cases, it will also be necessary to provide further documentation such as your resolution of registration as a freelancer in the Social Security.
What are the implications?
Inclusion in this regime offers various tax advantages in terms of taxation compared to taxpayers who are considered tax residents in Spain; we list them below:
- The main advantage is that the general taxable base is taxed at a fixed rate of 24% up to the first 600,000 euros. The exceeding amount is taxed at 47%.
- Taxes are only applicable on income obtained in Spain (except for income from employment), unlike tax residents who are taxed on their worldwide income.
- Those included in the regime are exempt from filing the informative declaration on assets and rights abroad (form 720) and are taxed by the wealth tax by real and not personal obligation.
It's important to note that initially, the regime may not be very appealing if your income is low, as the fixed rate of 24% could be higher than that applied in the general income tax regime. Therefore, it's necessary to analyze each situation individually.
When can I request it?
You may apply for inclusion in the regime, within the greater of the following deadlines:
- Six months from the entry into force of the OM (Ministerial Order), modified last 16/12/2023.
- Six months from the beginning date of activity in Social Security.
How can I request it?
The application is done through form 149 on the Tax Agency's website. Depending on your situation, you may need different documents, but don't worry, we're here to help you every step of the way!
At Xolo, we understand how important this process is for you. So, if you meet the requirements mentioned above, feel free to contact us at ayuda@xolo.io and we will advise you on this process.