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What is the Beckham Law in Spain and how does it benefit you if you apply for it?

Before making the decision to move to Spain, it is a good idea to review what options are available
in terms of laws, which may represent a great opportunity.

One of them, little known, and sometimes believed to be unrealistic, is the so-called Beckham
Law, precisely because of its name, which allows certain foreign workers to take advantage of a
special tax regime, significantly reducing the taxes they have to pay.

What is the Beckham Law in Spain?

Based on the information at https://tejadasolicitors.com/blog/what-is-the-beckham-law-spain/,

we can say that the Beckham Law is a special tax regime introduced in Spain in 2005.

Its aim is to attract highly qualified professionals and foreign workers to settle in the country. It is
named after the famous footballer David Beckham, who was one of the first to take advantage of
this law when he signed for the best football club for many, i.e. Real Madrid.

It allows foreign workers to be taxed in Spain as if they were non-residents for the first six years of
their stay, meaning they pay a flat tax rate of 24% on their income up to 600,000 euros, which is
beneficial.

Any amount above that threshold is taxed at 47%, which is still competitive with the progressive
rates applied to normal tax residents. Given its characteristics, it is attractive to many, although
not as many are aware of it.

Benefits of opting for it

If you are eligible to take advantage of this law, you can enjoy a number of tax and administrative
benefits, among them:

- Reduced taxation. You are taxed at only 24% on your income up to 600,000 euros, instead
of the progressive rates that can be as high as 47% for normal tax residents.
- Taxation as a non-resident. You won't pay tax in Spain on your income generated outside
the country, which is a great advantage for those with international businesses.
- Ease of tax filing. Under this regime, tax management is simpler and clearer, avoiding the
complexity of Spanish tax regulations applied to normal residents.
- Validity of six years. During this time, you will be able to enjoy an advantageous tax
regime without worrying about progressive taxation.
- Attractive for international professionals. Companies and workers will have the
opportunity to mutually benefit, as the lower tax impact makes Spain more attractive to
foreign talent.

Requirements to apply for the Beckham Law

Not all foreign workers will be able to access this regime, as there are requirements such as those
outlined below:

- You must be a foreign worker moving to Spain for work purposes. You must have received
a job offer in the country or have been assigned by your company to work in Spain.
- You must not have been in the country as a resident for at least five years prior to the
application. This prevents previous residents from using the Beckham Law to obtain tax
benefits after leaving the country and returning.
- Sign an employment contract with a Spanish company or with a Spanish branch of a
foreign company. This requirement aims to ensure that you are actually working in the
country and not using the law as a tax strategy.
- Do not obtain income through your own economic activities. Self-employed and
entrepreneurs are not eligible for this benefit; only employees with a contract.
- Apply within six months of starting work. After that time, you will lose your Beckham Law
eligibility.

What happens if you don't qualify?

If you do not meet the requirements for accessing the Beckham Law, it does not mean that you
cannot live and work in Spain. There are other options, especially if you are an EU citizen, for
example:
- Conventional residence for work. If you are from the EU, you can live and work without
needing a special visa. You only need to register as a resident with the Social Security and
obtain a Foreigner Identification Number, which if you have any doubts, we leave you
information about the NIE number in Spain: Frequently Asked Questions.
- Normal tax regime. Although you cannot access the reduced taxation of the Beckham
Law, it will be possible to optimise your taxes through tax deductions and financial
planning strategies.
- Visa for digital nomads and entrepreneurs. If you are self-employed or run a business,
you can apply for a specific visa that allows you to reside legally.
- Apply for the golden visa. If you invest in real estate or in the Spanish economy, you will
obtain residency through this investment programme.

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