There are many countries that, after the Pandemic, found out opportunities to attract talent and, consequently, new taxpayers. In this race to attract digital talent, Spain is well placed, among other reasons, because of its weather conditions, infrastructure, and the extension of our optical fiber.
One of the main tools Spain is developing aimed at getting a place on the podium of the “best countries” to live and work, is known as the Startups Law, which is currently in the process of being approved by the Parliament.
What are the advantages of this new legislation?
It is well known that Spain needs to improve the Beckham Law (specific tax regime applicable to inpatriates) to be more competitive and attractive for workers, entrepreneur and companies. The Startup Law currently in process foresees a substantial modification to the inpatriate regime (Beckham Law) which could help our business ecosystem to attract entrepreneurial profiles of the technological sector.
The following modifications are envisaged:
- Regarding the requirement of Non-Residence in Spain, the period is reduced from 10 to 5 years, which will allow expatriated Spanish talent to return to Spain earlier than expected with optimal conditions.
- The duration of this regime is extended from 5 to 10 tax periods.
- The scope of application of this regime is extended to the so-called “digital nomads”, people who work for a foreign company and provide their work remotely through the exclusive use of computer and telecommunication means and systems.
- The application of this regime is also extended to Directors of emerging companies, eliminating the limitation on the participation that administrators of this type of company may have.
- It is also allowed that the spouse and children under the age of twenty-five may also apply the special regime.
Regarding Corporation Tax, a rate of 15% is introduced applicable to the first tax period in which the company has profits and the following three, if they maintain the status of emerging company. In addition, the possibility of deferring the payment of Corporate Tax without guarantees is provided.
Regarding personal income tax, the taxation of stock options is modified, increasing the exemption from €12,000 to €50,000 and extending the latter to non-residents.
In addition, measures are introduced to simplify commercial and administrative procedures, allowing a NIE to be obtained through a simplified online procedure.
Finally, the so-called digital visas are introduced, which will be granted to technological entrepreneurs, facilitating access to residence and work permits.
The UHY Fay & Co tax team is at your disposal to help you if you consider that your Group or company may be affected by this new regulation.
Pitu Domecq
Socia – Tax & Legal
idp@uhy-fay.com
RELATED SERVICES:
– Tax advisory
– International Tax
