To qualify for the Beckham Law in Spain, individuals must be tax residents in Spain, spending over 183 days in the country annually and not have been tax residents in the previous 10 years.
To apply for the Beckham Law, an individual must meet several specific conditions to qualify for the special expatriate tax regime. Here are the key requirements:
1. Recent Arrival in Spain
- First Year of Tax Residency: The individual must have recently moved to Spain and become a tax resident. This means they must not have been tax residents in Spain for the 10 years preceding their arrival. The application for the Beckham Law must be made within six months of the start of their employment in Spain.
2. Employment in Spain
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Employment Requirement: The individual must be employed by a Spanish company or a Spanish branch of a foreign company. The Beckham Law is intended for expatriates who relocate to Spain for professional reasons, so the employment contract must be with a company based in Spain. Self-employed individuals, freelancers, or independent contractors are generally not eligible for this regime unless their activities are directly tied to an employment contract in Spain.
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Exclusion of Professional Athletes: Since the 2010 reforms, professional athletes have been explicitly excluded from benefiting from the Beckham Law. This was a significant change aimed at addressing concerns that the law disproportionately favored wealthy sports stars.
3. Primary Activity in Spain
- Main Economic Activity in Spain: The individual's primary work activity must be in Spain. The Beckham Law is designed to tax income generated from activities performed within Spain, so the bulk of the individual’s work should be related to their employment in the country. The law targets those who have relocated to Spain to carry out specific roles within Spanish-based businesses.
4. Application Deadline
- Application Timing: The application to benefit from the Beckham Law must be submitted within six months of the date the individual becomes a tax resident in Spain (typically the start date of their employment). This deadline is crucial; missing it can result in ineligibility for the special tax regime.
5. Limited Scope of Income
- Spanish-Sourced Income Only: The special tax regime applies only to Spanish-sourced income. This means that while foreign income is exempt from Spanish taxation under the Beckham Law, the income subject to the favorable flat tax rate must be generated within Spain.
6. No Prior Residency
- Non-Resident Status: The individual must not have been a tax resident in Spain for the 10 years preceding the move. This requirement ensures that the Beckham Law is reserved for those genuinely relocating to Spain for work and not for individuals who may have been living in Spain or previously benefiting from Spanish tax policies.
Summary
To apply for the Beckham Law, an individual must be a recent arrival in Spain, employed by a Spanish company or a branch of a foreign company, have their primary work activity in Spain, and not have been a tax resident in Spain for the past 10 years. The application must be made within six months of becoming a tax resident, and the special tax treatment applies only to Spanish-sourced income. Professional athletes are excluded from this regime.