DIGITAL NOMADS IN SPAIN. INTERNATIONAL TELEWORKERS

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Since the pandemic increased the possibilities of teleworking in the world, some people continue to telework. Spain offers a legal opportunity for digital nomads. The digital nomad visa is a residence permit which may be extended for a total of 5 years and which will allow non-EU nationals to (from outside the European Union) to live and work remotely from Spain (as a digital nomad). Yes, all foreigners can work remotely while residing in Spain!

Thanks to start-up law (see+), At last, foreigners who wish to move to Spain and continue working for a company abroad, or who have clients all over the world, will find a residence permit that is perfectly adapted to their needs. The visa for teleworkers is aimed at non-EU citizens, as Europeans can work remotely for up to 6 months in the country. (and if they wish to extend their stay, they just have to get their NIE as a resident (see TIP). The provisions of the start-up law for this visa do not apply to EU citizens and foreign nationals who are subject to EU law as beneficiaries of the right of free movement and residence.

One of the great advantages of this residence is the double application option.

1. On the one hand, you can apply directly from Spain with a tourist visa, directly obtaining the 3-year card.
2. But, on the other hand, it also allows you to obtain a 1-year visa from your country of origin (at the consulate) to be able to enter Spain and subsequently modify this 3-year card.

Do these years count towards nationality?

The answer is yes. The years with this 3-year card (and its subsequent renewals) count for both Spanish nationality and permanent residence (which you can get after 5 years as a remote teleworker in Spain). Apart from the tax advantages, this permit will also allow you to include your spouse and children in the same application, thus allowing you to move with your family to Spain. But that's not all, as it is framed within the Entrepreneurs Law, you will also benefit from an express resolution in just 20 days, and the applicable administrative silence is positive (so if you do not receive a response within this period, the resolution is considered approved). In addition, you will be able to move freely throughout the EU with this residence card.

Requirements for obtaining residence for digital nomads:

But before we go into the details of each requirement, you should note that there are two different profiles of foreigners who can obtain this permit (with slightly different requirements):

• Employees whose employer allows them to travel and work remotely from another country (in this case Spain).
• Self-employed (ENTREPRENEURS) with several clients spread all over the world or sources of income derived from online activities but spread outside Spain.

SO, IF YOU WANT TO APPLY FOR THIS FOR REMOTE WORK IN SPAIN:

• The company/s you work for must be located outside Spain.
• Revenues received in Spain or by Spanish companies may not represent more than 20% of the total.
• You must demonstrate that you have been working for your company or have been in a freelance relationship for your clients for at least 3 months prior to application.

Contract with the same company for at least 1 year.

You have two different options to demonstrate that you have sufficient experience and training to be able to complete the application.

• Demonstrate 3 years of related work experience prior to application, or...
• Be a graduate or postgraduate of a reputable university, vocational training and business school of recognised prestige.

You cannot have a criminal record, nor be banned from entering Spain. To do so, you must provide your criminal record certificate, with a minimum validity of 90 days, legalised and apostilled.

• Submit a declaration of no criminal record for the last 5 years.
• You will have to fill in the corresponding application form. (you can download it here)
• Pay the corresponding fee, in this case 790 038
• Take out private health insurance, with full coverage throughout Spain.
• Bank certificate proving possession of at least €25,000 (200% of the SMI) for the main applicant (and €9,441 for each additional family member, i.e. 75% of the SMI). If the money is held in a foreign bank, a simple translation is required. Or, in parallel, the same amount of money can be proved by means of a contract, payslips, certificate from the posting company, etc.

Finally, there is a difference depending on whether you work for an employer or are self-employed:

If you have a contract with a foreign company (as an employee), it is essential that the company has been in operation for at least 1 year prior to your application. In addition, this company must state that teleworking for your position is allowed and that it authorises you to do so. If you are self-employed, you must be working for at least one company (which must be outside Spain), and it will be through the conditions of your contract that the possibility of working remotely is specified.

Tax advantages of the digital nomad visa

The additional argument created to make this permit an even better option is the special tax regime that will allow digital nomad visa holders to save tax. Basically, you will be taxed under an optimised non-resident income tax regime. After understanding how taxation in Spain really works for foreigners, we can easily understand that paying non-resident income tax instead of the general income tax payable by residents allows you to pay much LESS on the income you generate.

If you have not been in Spain for the last 5 years (instead of 10, as is the general rule); you will be allowed to pay a flat tax rate of only 24% on your income, instead of a progressive rate of up to 48%. In order to be considered as a non-resident for tax purposes, you will have to initiate a separate application process from your residence permit, and you will do so with the Spanish Tax Agency within 6 months of obtaining your residence permit.

THIS IS A PROCESS COMPARABLE TO THE BECKHAM ACT

This, in addition to allowing you to pay only 24% on income derived from work up to €600,000, will also save you from having to pay wealth tax or having to make an informative declaration known as form 720. Finally, digital nomad visa holders will be able to apply for IRNR deferral in the first and second year with a positive taxable base (without interest). This advantageous tax regime will be extended for 5 years as long as you maintain your residence as a digital nomad and then switch to the general regime. 

Can I work in Spain with the digital nomad visa?

So far we have mentioned how residence for digital nomads allows non-EU citizens to work remotely from Spain. While this means working in Spain for a foreign company, is it possible to work in Spain for a Spanish company or client with this permit?The answer is yes, but with an important limit!

YOU CAN ALSO WORK FOR A SPANISH COMPANY PROVIDED THAT:

1. Maintain the commercial/contractual relationship with the foreign company that allowed you to obtain this visa; and... 
2. The income you generate from the Spanish company or client does not account for more than 20% of your total income.

HOW TO APPLY FOR THIS TELEWORKER VISA:

YOU HAVE TWO DIFFERENT OPTIONS, BOTH AIMED AT THE UGE:

• Apply for a digital nomad visa from your country of origin. You will obtain a 1-year visa to enter Spain (which can be changed to residence at a later date).
• Directly from Spain as a tourist, and obtain a 3-year permit (renewable for 2 more years until permanent residence).

You will benefit from a fast-track application, which means that you will get a favourable response in as little as 20 days. Once you have your decision, you will have to go to the police office as one of the last steps to register your fingerprints and obtain your physical residence card.