Here’s how to become a digital nomad in Spain

Are you a non-EU citizen looking to work remotely in Spain as a digital nomad? You’re in luck! Spain is one of the growing number of European countries to have introduced the Digital Nomad Visa.

Now, before visions of working by the beach get the better of you, there’s some groundwork to cover – from securing that visa to setting up your company and navigating Spanish tax laws. We’re here to walk you through it all, step by step.

So, are you ready to turn Spain into your new office backdrop? Let’s dive in!

What is the Spain Digital Nomad Visa

Since the start of 2023, Spain has introduced a new kind of visa specifically targeted towards remote workers. This is called the Digital Nomad Visa. It’s for people from outside the EU/EEA who want to live here and work remotely.

This visa is a great option if you are from outside the EU/EEA and want to live in Spain while working for a company back home or with clients worldwide.

A big plus of this residency is that you have two ways to apply:

• First, you can apply right from Spain if you’re there on a tourist visa. This way, you can directly get a residence permit.
• Second, you have the option to start the process from your home country by applying for a 1-year visa at the Spanish consulate. Once you’re in Spain, you can switch this over to the three-year card.

So, whether you’re already enjoying Spain or planning from afar, there’s a path that works for you.

Spain Digital Nomad Requirements

Thinking of swapping your home office for sunny Spain? Before you jet off, it’s crucial to understand the specific requirements for the Digital Nomad Visa. 

Here’s what you need to know to begin:

• Work Restrictions: You’re mainly allowed to work for companies outside Spain. If you want to work for Spanish companies as a freelancer, this can only be up to 20% of your total work.
• Income: Have a minimum monthly income of €2,650. This number increases to €995 for the first additional family member. Each additional family member included in the application will cost another €335.
• Work Relationship Requirements:
  • For Employees: You should have been working with a non-Spanish company for at least three months before applying. This company must be in operation for at least one year. Plus, you need proof that you can work remotely from Spain.
  • For Freelancers: You need a three-month relationship with any non-Spanish clients and proof that you can work remotely from Spain.
• Duration: The work with the company should be ongoing and expected to last at least one year.

These rules are created to make Spain an attractive spot for remote workers and expats while ensuring they have stable and ongoing employment.

How to Apply for the Digital Nomad Visa in Spain

Now that you’re armed with the requirements to get the coveted Spanish Digital Nomad Visa, let’s talk about the different ways you can apply:

Option 1: Apply Within Spain

• Preparation: Before you leave your home country, ensure you have all necessary documents together. They should be apostilled (officially certified), and translated by an authorized juror translator.
• Apply on Arrival: Land in Spain on a tourist visa, which typically allows a three-month stay.
• Application Process: Apply electronically before the Unit of Big Enterprises and Strategic Collectives (UGE). 
• Approval: Once approved, you’ll secure a residence permit that you can renew once you arrive in Spain.

Option 2: Apply From Your Home Country

• Preparation: Make sure to apostille and translate each required document, as per the consulate’s regulations.
• Apply at Home: Apply directly from your home country by visiting the nearest Spanish Consulate.
• Approval: Once approved, you will secure a one-year visa, which can later be converted into a temporary residence permit upon your move to Spain.

Navigating the Digital Nomad Visa Process

Given that Spain’s digital nomad visa is still in its early stages, the application process might seem daunting. 

While it’s possible to navigate this process solo, we recommend consulting with an experienced immigration lawyer to help simplify your journey to Spanish residency.

Creating a company in Spain as a Digital Nomad

Looking to set up a company in Spain as a digital nomad? The good news is the government has streamlined the process for foreign investors (including digital nomads) to set up a business, making it easier and faster. Here’s what you need to know:

1. Quick Online Setup: Now, in addition to the normal process of 15 working days to register your company, there is a fast option for setting up your company in just 1 day.
2. Reduced Capital Requirement: The initial capital needed has been reduced drastically from €3,000 to only €1 with the fast track option. However, it’s important to note that Shareholders will still be liable for €3,000.
3. No More Additional Fees: Costs associated with a notary public and Mercantile Registry have been eliminated, making the process cost-effective.
4. Faster Tax ID Assignment: Obtaining a Tax ID, crucial for directors or shareholders, is now quicker, aiding in smoother financial transactions from abroad.
5. Simple Business Closure: If necessary, shutting down your business can be done easily through an online procedure.

These updates aim to make Spain more appealing to digital nomads by removing previous barriers to business creation.

Taxes for Digital Nomads in Spain

It’s time to talk about everyone’s favorite thing: taxes.

While it might not be the most thrilling topic, navigating taxes in Spain is crucial for digital nomads planning to reside there. Here’s a breakdown of tax scenarios you might face:

• Spanish Tax Residency: If you’re in Spain for more than 183 days within a calendar year, you’re a Spanish tax resident and must pay taxes in Spain.
• Primary Residence Taxes: If you spend more days in Spain than in any other country, you’re liable for Spanish taxes. This applies even if you work for a foreign entity like a company, partnership, LLC, or S-Corp, and includes freelance income.
• Remote Employees: If you work remotely for a non-Spanish company, your income, including benefits like stock options or gym memberships, is subject to Spanish taxes.
• Freelancers in Spain: If you’re freelancing, you need to register as “Autonomo” (self-employed) with the Spanish Social Security and tax authorities. You must charge VAT, file quarterly tax returns, and pay into the social security system, which could impact your visa status.

Understanding these tax obligations is essential to ensure compliance and avoid surprises while enjoying the digital nomad lifestyle in Spain.

Taxes for Companies: Explained

If you’re a digital nomad with a business located outside of Spain, listen up, because how you move your money could affect your tax bill.

• Type of Income: Your earnings from abroad can be classified either as employment income or dividends, depending on your business structure.
• Tax Rates: The type of business you have affects your taxes. Income from partnerships like LLPs, SCorps, or similar is taxed up to 48% in some Spanish regions. Dividend income from companies like LTDs, C-Corps, or SLs is taxed at rates between 19% and 26%.
• Double Taxation Agreements: Spain has agreements with 90 countries across the globe to prevent double taxation. These ensure that if you pay tax abroad, you can deduct it from your Spanish tax, preventing you from having to pay tax twice on the same income.
• Penalties for Non-Filing: Failing to file a tax return can result in penalties ranging from 50% to 150% of the tax due. Also, Spain’s tax authorities exchange information with other countries, making it important to comply with tax obligations.
• Declaration of Overseas Assets (Form 720): If you have foreign assets worth more than €50,000, you must declare them to Spanish authorities using Form 720. This includes overseas bank accounts, real estate, and investments

While taxes might not be the most exhilarating part of your digital nomad adventure, staying informed and compliant with these regulations is crucial to avoid penalties and ensure the smooth operation of your business while living as a digital nomad in Spain.

Frequently Asked Questions About How to Work Remotely in Spain as a Digital Nomad

Can I work for Spanish Companies with the Digital Nomad Visa?

Yes, but with limitations. With the Spain Digital Nomad Visa, you must work for non-Spanish companies primarily. However, you are can do some work for Spanish companies, capped at 20% of your total work activity.

Do digital nomads pay tax in Spain?

Yes, digital nomads may need to pay taxes in Spain depending on their residency status and income source. If you become a Spanish tax resident (staying more than 183 days in Spain within a year), you are liable to pay taxes on your worldwide income. Non-residents must pay tax only on Spanish-sourced income.

What is the Beckham Law in Spain?

The Beckham Law is a Spanish tax regulation that allows certain expatriates to pay taxes as non-residents for a period, thereby reducing their tax rate significantly. 

Recently, it’s been extended to cover certain professionals moving to Spain, potentially including digital nomads under specific conditions, allowing them to benefit from a lower tax rate on their income.

How long can you work remotely in Spain without paying taxes?

The rule of thumb is that if you spend more than 183 days in Spain within a calendar year, you become a tax resident and are liable to pay taxes on your worldwide income. 

If you stay less than 183 days, you are not a tax resident and typically would not pay Spanish taxes on your foreign income. However, individual circumstances can vary, so it’s essential to consult with a tax professional.

Can Lexidy Help Me Work Remotely in Spain?

Absolutely! Navigating the nuances of remote work in Spain can be tricky. But don’t worry, the legal eagles at Lexidy have your back. 

From visa applications to setting up a company and paying taxes – our team of experienced lawyers is here to guide you through all aspects of being a digital nomad in Spain.

Ready to streamline your remote work journey in Spain? Fill out the form below to begin, and let’s make your dream of working under the Spanish sun a reality!

(Article Updated 03/2024 by Lexidy Team)