Updated Tax Incentives For Assignees under Revised Beckham Law in Spain

Named after renowned footballer David Beckham, the ‘Beckham Law’, officially titled the ‘Special Tax Regime for Expatriates’, was introduced in December 2003 via Royal Decree 1008/2023. Its aim was to entice foreign talent by providing tax benefits to non-residents employed in Spain.

Enhanced Tax Benefits: Amendments to the Beckham Law
Long favored for its tax advantages, the Beckham Law allows beneficiaries to pay tax solely on income earned within Spain, at a flat rate of 24% for the first €600,000 and 47% thereafter. This stands in contrast to standard Spanish tax rates, which can reach 47% even for incomes below €600,000.

Under the revised law, these benefits are poised to become more enticing. Beneficiaries can now avail of these reduced tax rates for six years, up from the previous limit of five years. This extended period holds the potential for significant tax savings.

Furthermore, the non-residence period required before eligibility has been slashed from 10 years to 5, providing increased flexibility.

For taxpayers who obtained residency due to relocation in 2023, a deadline of 6 months from December 16 of the year of their relocation has been established for them to take advantage of the special tax regime.

New Categories Covered by Spain’s Beckham Law

In a positive development, the revised Beckham Law will now extend to immediate family members (spouses and children) of beneficiaries, likely encouraging long-term relocation to Spain.

Additionally, freelancers and remote workers are now eligible groups. This alteration streamlines the process for these workers, making Spain a more appealing destination for global talent.

Looking Forward: Spain’s Dedication to International Talent

Following Spain’s implementation of the EU’s Blue Card visa last year, the revisions to the Beckham Law serve as another clear indicator of the country’s commitment to attracting international talent, granting Spanish employers access to a broader pool of highly skilled labor.

As we progress further into 2024, both employers and employees must remain informed about these changes to maximize potential benefits.