Special regime for displaced persons

If you are a foreign worker who has been temporarily displaced to Spain, you need to know the special regime for displaced persons regulated in the article 93 of the Personal Income Tax Law (IRPF). In this article, we tell you what the special regime consists of, what requirements must be met and what procedures to follow.

This particular regime is also known as Beckham Law, since the footballer David Beckham was among the first to benefit from the regime.

Special regime for workers posted to Spanish territory

The speciality is that natural persons who have their residence in Spain due to a move may pay taxes for the Non-Resident Income Tax (IRNR).

The requirements that must be met are the following:

• Not having been a resident in Spain during the ten tax periods before the displacement.
• That the displacement occurs for any of the following reasons:
  • By an employment contract, except for professional athletes.
  • For acquiring the director status of a company whose capital he does not participate.
• That you do not obtain income that can be classified as income obtained through permanent establishment in Spain.

What models should be presented?

In order to opt for the option described in the previous section and pay IRNR tax, the taxpayer must present Form 149. This model will also be used when the special regime for displaced persons is waived because not all the requirements are met.

The tax declaration is made using Form 151.

How is the tax debt determined in the special regime for displaced persons?

The following rules will be taken into account to determine the taxpayer’s tax debt.

• Income derived from an activity carried out before moving to Spain or after communication of renunciation of the regime is not understood to be obtained during the application of the special regime.
• The differential fee will be the result of reducing the full tax fee by:
  • The deductions in the quota referred to in article 26 of the Income Tax Law of Non-Residents. (IRNR) (donations and withholdings and payments on account made on the taxpayer’s income).
  • The deduction for international double taxation.

How to renounce the special regime

Taxpayers who have opted for the special regime for displaced persons may renounce it during November and December before the year the resignation must take effect.

The resignation procedure is as follows:

• Presentation to the retainer of the communication of previous data.
• Presentation to the Treasury of Form 149.

Generally, the resignation occurs because there is a failure to comply with one of the legally established requirements. People who renounce this regime or are excluded cannot request that it be applied to them again.