If you are thinking of coming to live in Spain to work or you have just moved to Spain, in this blog we explain everything you need to know about the Digital Nomad Visa so that you can have a complete experience, either working from home or a coworking space like Vortex Coworking in Valencia. Let´s go:
In December 2022, the law known as the Startups Law, was published in the Official State Gazette (BOE), a law that aims to attract entrepreneurs, investment projects and qualified workers to Spain. The law on start-ups is a substantial improvement on the law published in 2013, known as the Entrepreneurs Law. It regulated visas for entrepreneurs, investors, and other figures who favoured the residence in Spain of people from countries outside the European Union. The new law on start-ups has adapted the regulations to attract talent and innovation. Through tax incentives, the elimination of obstacles and the easing of procedures, the aim is to encourage the creation of technology-based companies, increase investment in R&D&I and attract investment for newly created companies.
One of the most relevant aspects of the Start Ups Act refers to the improvement of conditions for the establishment of remote employees and digital nomads through a new visa.
What are the characteristics of this new visa?
The new visa for digital nomads is a residence permit for non-EU citizens for a maximum period of 5 years that will allow applicants to work in Spain, either for foreign companies or developing their own entrepreneurial activities. This visa can be applied for from Spain or from abroad. After the fifth year, permanent residence in Spain can be obtained and family reunification is possible. Those who apply for it and obtain it may move to Spain with their family. Obtaining the aforementioned visa also allows you to move freely throughout the European Union.
What are the tax advantages of this new visa?
The main advantage is that holders of this visa will be taxed in Spain under an optimised non-resident tax regime. Those who have not resided in Spain in the last five years before the application for the residence permit will be taxed at a rate of 24% on the income generated, instead of a progressive rate that could tax up to 48% of the income.
The process of admission to the register of non-residents (Impuesto de la Renta de los no Residentes – IRNR) for tax purposes is different from the application for a residence permit and is carried out through the Tax Agency (Agencia Tributaria). Inclusion in this register must be made within six months of obtaining the residence permit.
The tax regime for non-residents can be extended for a maximum period of 5 years after which it will be transferred to the general regime.
What are the requirements for obtaining this visa?
The requirements are very similar, but depend on the profile of the digital nomad. Thus, two categories are established:
- Employees who will work remotely for a foreign company from Spain.
- Self-employed workers with activity outside Spain.
The common requirements, irrespective of the profile of the employee, are as follows:
- The contracting company must be outside Spain
- Revenues generated in Spain cannot account for more than 20% of the total.
- A continuous employment or professional relationship of at least 3 months must be demonstrated.
- Incorporate an employment contract of at least 1 year.
- Prove that you have no criminal record and provide a sworn statement.
- Taking out private health insurance
- Certify possession of at least €25,000 in a Spanish or foreign bank and at least €9,441 for each additional family member.
Finally, in the case of employed work, the contracting company must have been in operation for at least one year. On the other hand, if the applicant is self-employed, he/she must prove that he/she is working for at least one company outside Spain.
How can I apply for this visa?
The visa must be processed through the Large Companies Unit (UGE), an institution set up to carry out the formalities and procedures related to companies that require foreign workers and attached to the Ministry of Employment and Social Security.
- From the country of origin. Through this channel you will obtain a 1-year visa to be able to enter Spain and subsequently apply for a residence permit.
- From Spain as a tourist and obtain a permit to stay in the country for 3 years, which can be renewed for two additional years until permanent residence is obtained.
Remember that if you have any doubt about the Digital Nomad Visa or any other questions about how and when process it, do not hesitate to contact our partners Gestion Valenciana, a group of expert lawyers and accountants in Valencia
If you need more information on other legal areas, such as the NIE or tax residency in Spain, take a look at our blogs about taxes.