Tax in Spain for Expats

Spain is a top destination for international professionals and companies relocating talent. But its tax system is complex, and mistakes can be costly. If you’re an expat—or managing international mobility in your company—you know that tax missteps can lead to penalties, double taxation, or missed opportunities.

At Adlanter, we understand the risks. That’s why we offer a comprehensive Expatriation Planning service designed to help you stay compliant, avoid surprises, and optimize your tax situation from day one.

What does it mean to be an expat in Spain tax-wise?

You’re considered a Spanish tax resident if you meet any of the following:

• You spend more than 183 days in Spain in a calendar year.
• Your main economic interests are in Spain.
• Your spouse and dependent children live in Spain.

If you qualify, you’ll be taxed on your worldwide income. If not, you’ll only be taxed on income earned in Spain.

Key taxes that affect expats

Personal Income Tax (IRPF)

• Applies to tax residents.
• Progressive rates up to 47%.
• Covers global income (salary, rental income, dividends, etc.).

Non-Resident Income Tax (IRNR)

• Applies to those who don’t meet tax residency criteria.
• Flat rate: 24% (or 19% for EU/EEA residents).
• Only applies to Spanish-sourced income.

Wealth Tax

• Applies to tax residents.
• Taxes global net wealth.
• Exemption up to €700,000 (varies by region).

Modelo 720

• Mandatory declaration of foreign assets.
• Required if you hold over €50,000 in foreign accounts, properties, or investments.
• Heavy penalties for non-compliance.

 How to legally save taxes as an expat in Spain

Apply for the Beckham Law

The special tax regime for inbound workers allows:

• Taxation only on Spanish-sourced income.
• Flat rate of 24% up to €600,000.
• Valid for 6 years.

Practical example:

A U.S. executive relocating to Madrid with a €150,000 salary pays 24% instead of 45%. Estimated savings: over €30,000 per year.

Key requirements:

• Not a Spanish tax resident in the last 5 years.
• Relocation must be work-related.
• Must apply within 6 months of registering with Spanish Social Security.

Avoid double taxation

Spain has tax treaties with over 90 countries to prevent double taxation on the same income.

Practical example:

A French professional with rental income in Paris and tax residency in Spain can avoid double taxation by applying the Spain – France treaty.

Time your relocation strategically

Spain’s tax year runs from January to December. The timing of your move can determine whether you’re taxed as a resident or non-resident.

Practical example:

A professional moving in July can plan to stay under 183 days and be taxed only on Spanish income for that year.

Declare foreign assets correctly

Modelo 720 is mandatory if you hold:

• Foreign bank accounts over €50,000.
• Real estate abroad.
• Shares, funds, or insurance policies outside Spain.

Adlanter tip: Failure to file can lead to penalties of up to €10,000. We ensure full compliance with no surprises.

Optimize your asset structure

If you own investments, property, or companies abroad, it’s essential to assess their tax impact in Spain.

Practical example:

An expat with a UK-based company can restructure ownership to avoid taxation on undistributed profits.

 

At Adlanter, we offer a comprehensive approach to international mobility. We start with a pre-move tax residency analysis to define your obligations clearly. We apply double tax treaties to avoid unnecessary taxation and assess your eligibility for the Beckham Law, managing the full application process. Our team handles all key filings—IRPF, IRNR, and Modelo 720—ensuring full compliance. We also advise on legal and labor aspects to align contracts and compensation with Spanish regulations. And we stay with you throughout the journey: before, during, and after your relocation.

Want to save taxes and avoid costly mistakes in your move to Spain?

At Adlanter, we help you plan your relocation with legal certainty and tax efficiency.

Book a meeting with our experts and turn your international mobility into a strategic advantage.