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10 easy steps to sell property in Spain

Raymundo Larraín Nesbitt, June, 25. 2024

Raymundo Larrain gives a sweeping overview on how to sell property in Spain safely.

Marbella-based Larraín Nesbitt Abogados (LNA) has over 21 years of experience at your service. We offer a wide range of 60 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record of successfully assisting expats all over Spain.

You can review here our client’s testimonials.

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Abogados
8^th of July 2024

Introduction

Today’s article mirrors last month’s Ten easy steps to buy property in Spain.

The following article aims to be a basic checklist covering what I reckon are the ten basic points, nothing more.

There are two taxes involved on selling Spanish property: Capital Gains Tax and Plusvalia Tax.

I’ve divided my article into five points pre-completion and five points post-completion.

As a word of caution, never hand over your house keys before completion (at the notary). As explained in our article: POSSESSION: why you should never hand over your house keys BEFORE completion.

Ten easy steps to sell property in Spain

I. Pre-completion

1. Hire an estate agent

Estate agents in Spain, for the most part, remain unregulated. This means that anyone can be an agent, but few stand the test of time

Good estate agents are proactive, they prove invaluable as they help to fetch a fair sales price in a short span of time (months). By contrast, bad agents are passive, and your house will be on sale for years.

A seasoned agent will decide on what’s the best market strategy to sell your property giving you all kinds of useful tips. Make sure you take to heart these tips, as they greatly impact on positive property viewings. Always ask your agent for feedback after each viewing, taking action where necessary to turn around negative feedback.

On selling, you need to list your property with a property platform such as IDEALISTA (Spain’s number one) or with one, or more, agents. Be mindful of giving an agent exclusivity on your property unless you are sure of what you are doing.

Hallmarks of reputable agencies:

The estate agency has been around for a long time (years, even decades)
Ask around for referrals from people you trust
Member of RICS, which works to (high) British standards
Member of LPA (Leading Property Agents), or similar
Glowing reviews and stats across multiple platforms (Trustpilot, Google reviews, etc)
Excellent contact network
Superb local market knowledge

Do not trust estate agencies that flaunt shady ’real estate awards’. Every week I'm emailed three of these ‘international awards’ in exchange for money.
Remember, unlike in other countries, estate agents work only for the seller.
Agent’s fees are 100% tax-deductible on selling your property in Spain.

2. Hire a lawyer

Hiring an independent lawyer is the best advice I can give you. If you are a non-resident in Spain (particularly a foreigner), you are strongly advised to instruct a lawyer to assist you through the conveyance procedure. Lawyers are regulated by professional bodies, subject to disciplinary action. Lawyers have professional indemnity insurance in place in the event of malpractice or negligence. Your appointed lawyer can do all the following, and more:

Line up all the required documents
Avoid payment scams
Avoid abusive sales commissions
Avoid possession issues
File a 3% tax rebate
If selling at a loss, filing a tax rebate on the Plusvalia Tax
Dealing with other lawyers, tax office, agents, banks, notary, community of owners, town hall, etc.
Dealing with utility companies (water, electricity, gas, landline, etc)
Discharge a pre-existing mortgage on the property. Buyers demand a clean title, they don’t buy with a mortgage against it
(Greatly) mitigate the seller’s Capital Gains Tax liability (on average reduce your tax bill by 70% or more)
Negate the CGT on reinvesting the sales proceeds on a new main home (even outside the EU i.e. in the United Kingdom).

Lawyer’s fees are 100% tax-deductible on selling your property in Spain.

3. Price to sell

It’s of critical importance a seller adjusts the asking price to match market expectations.

I understand - and it is perfectly human - that owners have a penchant towards overpricing their property, all the while overlooking its flaws. However, if you want a smooth sale within a reasonable timeframe (3 months), you must pick an asking price that matches a realistic valuation. Otherwise, you can be waiting for years on end until the property is sold. It is not uncommon to hear people have waited over a decade to sell in Spain (because they did not price the property correctly).

In my professional experience, properties that have been on the market for too long (6 months plus) become a stale listing which acts as poison; would-be buyers start wondering if there is something wrong with the property which drives the sales price in a downward spiral. Unrealistic pricing leads to long sales times.

Remember, be smart, price to sell.

4. Tax compliance

It is strongly advised that sellers are up to date with their tax and maintenance expenses. If you are in arrears with your taxes, this may impact adversely your tax rebates post-completion (see below).

Buyers, on running a due diligence on the title, will get a poor impression when a seller has fallen in arrears. Moreover, in some cases, falling in arrears may even jeopardise a house sale i.e. when a buyer needs a mortgage loan to complete (lenders do not borrow against properties with debts).

5. Documents to sell

As mentioned in the first point above, your lawyer can (greatly) assist you in collating all the necessary paperwork to sell.
The following list is not exhaustive:

Full scanned copy of your title deed
Copies of your national ID, passport, NIE number
Copy of recent utility invoices
Copy of IBI tax invoices
Copy of Refuse Charge (Basura, in Spanish)
Energy Performance Certificate
Licence of First Occupation
Scanned copies of the minutes of the last three General Assemblies
Community of Owner’s Certificate stating the property being sold is not in arrears
Spanish fiscal residency certificate (to avoid a 3% retention on the sales proceeds)
Etc.

If all the above points check out, you are ready to roll. A property sale follows three stages in Spain:

Sign a reservation contract: in exchange for getting paid €3,000 or €6,000 (dependent on the sales value) you reserve the property over the next 30 days, during which the sales contract must be signed. This is a simple one-page document drafted by the listing estate agency.
Sign an arras contract (sales contract): the buyer makes a non-refundable 10% deposit. This detailed contract stipulates a day and time to sign at a notary plus all the sales conditions. This contract is drafted by the buyer’s lawyer.
Completion at a notary office. The balance of the asking price is paid and the keys are handed over (possession).

II. Post-completion

6. Capital Gains Tax mitigation

CGT for non-residents is 19%. Again, your lawyer will assist you in gathering all the necessary paperwork to bring down your CGT liability on selling, within the law. Your lawyer can reduce your tax bill by 70%, or more. This is explained in detail in our article Capital Gains Tax mitigation on selling (or gifting) property in Spain.

7. Plusvalia Tax rebate

If you are selling at a loss, you can file a tax rebate on the Plusvalia Tax you’ve paid.

8. 3% tax rebate

By law, buyers withhold 3% of the sales proceeds if a seller is a non-resident. A lawyer can file a tax rebate on the seller’s behalf on all, or part, of the 3%. If a seller is in arrears with his property taxes, this precludes a tax rebate. This is explained in our taxation article: How to file a 3% tax rebate on the sales proceeds of your Spanish property.

9. Serve legal notice to your community on the house sale

Your lawyer can notify them on your behalf. The reason on why this is necessary is so that all the new invoices they raise are against the buyer, not against the seller. This ringfences your liability.

10. Closing your Spanish bank account & dealing with transfer of utilities

Your lawyer can advise you on this. If you close your account too early, you will jeopardise the tax rebates from the Spanish Tax Office (meaning you lose all your tax refunds!).

Again, your lawyer can ensure the utilitie's contract transfer is smooth, avoiding payment issues or supply disruption.

Conclusion

If you plan to sell property in Spain, and are a non-resident, contact us to assist you in the legal procedure. We act nationwide.

At LNA we make it all easy, so you just have to sit back and relax. We take care of everything removing all the associated stress.

Not to mention our fees are 100% tax-deductible on selling!

21 years of experience at your service.

Related services available from LNA:

“Même s'il me faut lâcher ta main / Sans pouvoir te dire à demain / Rien ne défera jamais nos liens (...) L'amour est plus fort que le chagrin.” – Françoise Hardy

Françoise Madeleine Hardy (1944 – 2024). Born in Paris, was a gifted French singer-songwriter and actress. Mainly known for singing melancholic sentimental ballads (Tous les garçons et les filles), Hardy rose to prominence in the early 1960s as a leading figure of the yé-yé wave, and went on to become a cultural icon both in France and internationally. In addition to her native French, she also sang in multiple languages. Aussi belle que douée.

At Larrain Nesbitt Abogados (LNA) we have over 21 years of experience specializing in immigration & residency visas. We also assist clients in buying, selling, or renting properties in Spain. You can contact us by e-mail at info@larrainnesbitt.com, by telephone at our UK line (+44) 0754 3838 218 or Spanish line (+34) 952 19 22 88, or by completing our contact form.

Please note the information provided in this article is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. Ní neart go cur le chéile. VOV. Soyez réalistes, demandez l'impossible.

Larraín Nesbitt Abogados, small on fees, BIG on service.
2024 © Raymundo Larraín Nesbitt. All Rights Reserved.

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10 easy steps to buy property in Spain

Raymundo Larraín Nesbitt, May, 30. 2024

Raymundo Larrain gives a sweeping overview on how to buy property in Spain safely.

Marbella-based Larraín Nesbitt Abogados (LNA) has over 21 years of experience at your service. We offer a wide range of 50 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain.

You can review here our client’s testimonials.

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Abogados
8^th of June 2024

Introduction

The following article aims to be a basic checklist covering what I reckon are the ten basic points, nothing more.

I have greatly abridged it, not going into detail on whether you are buying resale or a new build property, or between commercial, urban, or rural land.

If you fancy a more in-depth and fleshed out guide on how to buy property in Spain safely, I refer you to our detailed Homebuyer’s Guide in Spain.

Ten easy steps to buy property in Spain

1. Hire a lawyer

If you are a non-resident in Spain (particularly a foreigner), you are strongly advised to instruct a lawyer to guide you through the procedure. Your appointed lawyer will run a due diligence on the property ensuring you acquire a clean title with no outstanding debts or taxes.

Your lawyer requires a Power of Attorney. A PoA enables a lawyer to act on the buyer’s behalf:

opening a bank account
applying for a NIE number
apply for a mortgage loan (in Spain, by law, a borrower is required to pass a multiple choice test to qualify, your lawyer can take the test for you)
drafting & signing legal documents on behalf of the principal
filing property taxes
connecting utilities
dealing with a community of owners

Beware of anyone telling you that hiring a lawyer is unnecessary, you can be sure they have vested interests of their own.

2. Apply for a NIE number

A NIE number is a tax identification number for foreigners which identifies you before the Spanish Tax Office and allows you to file and pay taxes in Spain. A NIE number is an essential admin document that everyone in Spain will be asking for: banks, schools, town halls, healthcare etc. It’s a must-have; the sooner you get it, the better. We can get you a NIE in 2 weeks.

3. Open a bank account

Opening a bank account in Spain is required on buying property (or when you apply for a visa). Utility companies and Spanish health providers only accept Spanish accounts to domicile payments. You will be required to attend the bank in person to open an account.

4. Do you need a visa?

If you are an EU national, as a general rule, you do not need a visa to stay in Spain. However, if you plan to spend more than 90 consecutive days in Spain, you must apply for a residency permit. This is fast-tracked for all EU nationals, attained by us in under one month.

If you are a non-EU national, as a general rule, you are required to attain a visa to remain in Spain for more than 90 consecutive days. Some visas must be applied for from your home country (before travelling to Spain), yet others can be applied for from Spain. You can read our comprehensive Spanish visa overview for more details.

5. Reservation contract

Once you’ve decided on a property, you need to commit.

Typically, an estate agent listing the property will ask you to pay €3,000 (or €6,000 for more expensive properties). This is normal, don’t worry. Unlike in other countries, such as in the United Kingdom, there is no 14-day cooling-off period. Reservation deposits are non-refundable (unless expressly agreed and worded otherwise in the contract).

A reservation contract is a simple one-page document whereby the seller reserves a property for you over the next 30 days in exchange for a deposit. If you go ahead and complete, the deposit will be part of the sales price. If you decide to pull out, you lose the deposit.

6. Hire a surveyor

We strongly advise buyers to hire a property surveyor, particularly on buying rural property or on buying off-plan property. Surveyors draft a comprehensive report with a detailed snagging list. This report is very useful and can be used to detect build flaws and re-negotiate the sales price. We advise surveyors to be registered with RICS, which works to high professional standards.

7. Exchanges - signing an arras contract

Signing an arras contract requires you to pay 10% of the asking price. This amount is non-refundable once signed and paid.

If the buyer pulls out of the contract – for whatever reason – they lose the 10%.

If a seller pulls out of the contract – for whatever reason – they pay 20% of the asking price (as a penalty).

Signing an arras contract is a (very) serious matter. Under no circumstances should a buyer sign it without a lawyer. Depending on how they are worded, some of these contracts actually force buyers to pay the full property price! Even if they do not want to. You can be taken to court over this contract.

8. Completion

Normally, 30 to 45 days after signing an arras contract, depending on whether the buyer requires a mortgage loan or not, the parties need to attend a notary chosen by the buyer to sign a Title deed (escritura, in Spanish) witnessed by a notary public. The buyer will now pay the balance of the asking price and possession will be his (keys hand over).

9. Property registration

After you sign at a notary, you need to pay the associated Property Transfer Tax. The Title deed must then be lodged at a land registry by your lawyer. This usually takes 1 to 2 months, depending on how busy the registrar is at the time.

It is important to understand that if a property is not registered under a buyer’s name, he does not legally own the property, even if he signed a Title deed.

The main reason is because Spain follows a two-tier system of transfer of ownership (notary and land registry). For peace of mind, ownership of a property can be verified in under 24 hours on commanding a nota simple service from us. A nota simple is a land registry report.

10. Post-completion

Post-completion, a buyer still has to deal with a long to-do list.

Your lawyer can (greatly) assist you in cutting through all the below red tape saving you money, time, and aggravation:

Utilities: Your lawyer can connect you to the mains (water & electricity). Also, to internet, gas, and landline. We offer this utility connection service.
Taxes: on owning a property in Spain you will be required to pay for a series of taxes, both local and national. As local taxes, you have to pay IBI and garbage collection tax. As a national tax, non-resident property owners need to pay once a year what is known as imputed rental income tax (even if you do not rent out the property, it’s a notional income tax). Failure to pay some of these taxes will lead to embargoes (legal charges placed against your property) which may result in your home being impounded and sold off in a public auction. We offer this tax service.
Padron: If you plan to live in Spain, you must enrol in the town hall census (padron). This is known as empadronarse or empadronamiento in Spanish. This is required to access public healthcare, vote on local elections, apply for a mortgage loan, schools, etc. We offer this padron service.
Community of Owners or EUC: If you buy a property within an urbanizacion, or development, you will need to join the community and pay your fees. These are normally paid quarterly. Non-payment may lead to the community suing you.
Making a Spanish will. On owning property in Spain, it is strongly advised you make a Spanish will. A Spanish will safes your beneficiary's time, money, and aggravation at a time of bereavement. A Spanish will does not preclude one made in your home country, it only affects your Spanish estate. Ideally, foreigners should make two wills; one in their home country and one in Spain disposing of their Spanish estate. We offer this will-writing service.

Conclusion

If you plan to buy property in Spain, and are a non-resident, contact us to assist you in the legal procedure.

At LNA we make it all easy, so you just have to sit back and relax. We take care of everything removing all the associated stress.

Not to mention our fees are 100% tax-deductible on selling!

Related services available from LNA:

At Larrain Nesbitt Abogados (LNA) we have over 21 years’ experience specializing in immigration & residency visas. We also assist clients buying, selling, or renting properties in Spain. You can contact us by e-mail at info@larrainnesbitt.com, by telephone at our UK line (+44) 0754 3838 218 or Spanish line (+34) 952 19 22 88, or by completing our contact form.

Larraín Nesbitt Abogados, small on fees, BIG on service.
2024 © Raymundo Larraín Nesbitt. All Rights Reserved.

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Moving to Spain? Spanish visa overview

Raymundo Larraín Nesbitt, May, 1. 2024

Raymundo Larrain gives us a sweeping overview of the Spanish visa system. If you are a non-EU national, and plan to move to Spain, this article is for you.

Marbella-based Larraín Nesbitt Abogados (LNA) has over 21 years’ of experience at your service. We offer a wide range of 50 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain.

You can review here our client’s testimonials.

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Abogados
8^th of May 2024

Spain is the second most visited country in the world, with over 84 million tourists every year. It’s a beautiful country to visit or live in. Gorgeous weather, great food, affordable prices, great amenities, and ultra-low taxation (in some regions of Spain) appeal to foreigners at large. Many of these tourists decide to settle down and buy a property in Spain.

In recent years, Spain has introduced two new immigration schemes with significant tax advantages associated for those that qualify: Beckham’s Rule (named after the English football player) and also the Digital Nomad Visa.

Both of these allow applicants to pay NO tax on any assets or income held abroad. Moreover, on the income derived strictly in Spain, applicants pay only a flat fee, which is a mere fraction of the standard tax rates. These two immigration schemes have been purposely devised to attract foreign overachievers, so they relocate to Spain alone, or with their families. Due to their unique tax advantages, they are proving wildly popular amongst foreign applicants, both EU and non-EU respectively.

At LNA, we can help you attain a visa or residency permit to live in Spain legally in record time at an affordable price. Your case will be handled by one of our immigration lawyers assisted by one of our in-house visa managers.

General requirements for Spanish visas

The following five are staple requirements across all visa types:

Non-EU national
Hire private health insurance
Clean criminal record, no trace (previous 5 years)
Be self-supporting (you will not claim benefits from the State)
Not be living in Spain illegally at the time of making the visa application

Spanish visa overview

Spain offers five visas for non-EU nationals. At LNA, we can assist you in filing all five below.

Some visas will suit applicants better than others. Some offer unique tax advantages.

1. Golden Visa – Investor Visa

Spain’s Government announced on the 8^th of April 2024 they will be scrapping this visa. However, it will take them many months to implement this change (likely by Autumn). For those who are still interested, you should apply now whilst you still can.

The investor visa is thought for affluent non-EU applicants. It is popularly known as a ‘Golden Visa’. It’s a blue-ribbon visa that basically rolls out the red rug for its privileged holders that neatly cuts through all the red tape. Its purpose is to foster foreign investments in Spain. Whilst there are many different ways to attain a GV, the most popular (and least expensive) is by investing in Spanish real estate. This requires investing €500,000 in property.

We should point out that it applies retrospectively; meaning that any non-EU national that bought a property in Spain for over 500k on or after the 28th of September 2013 may qualify. The investment in property can be made either as a physical person or as company. Alternatively, you can also deposit €1mn in a Spanish bank (no need to invest it), or you can invest €2mn in Spanish listed shares. All three ways will allow you to qualify for a coveted golden visa.

Unlike the other four visas listed below, renewals are not tied to proving you live in Spain all year round. They are based on keeping the investment. This ability to override the 90/180-day rule and not being ‘forced’ to live in Spain, make it one-of-a-kind visa and goes on to explain why it is highly sought-after by affluent individuals.

Another point to consider, is that the Golden Visa is the ONLY visa in Spain which does not make you tax resident in Spain on applying for it. GVs allow you the right to work in Spain (optional). This visa is attained by us in under 3 weeks.

Suitable for:

Affluent applicants who invest €500,000 in Spanish real estate.
Affluent applicants who deposit €1mn in a Spanish bank.
Affluent applicants who invest €2mn in Spanish Teasury bonds, or €1,000,000 in shares of publicly trading Spanish companies.

Further reading: Spanish Golden Visa Explained

2. Digital Nomad Visa (tax-free visa)

Spain’s Digital Nomad Visa (DNV) was approved in December 2022. The DNV is extensive to family members i.e. spouse and children under the age of 18 years old.

It allows applicants to work remotely from Spain i.e. teleworkers. The main advantage of a DNV is its privileged taxation. It grants its applicants a special tax regime whereby they pay very few taxes as opposed to the standard tax rates that apply to Spanish tax residents.

The main two tax advantages open to successful DNV applicants are:

No tax on assets & income held abroad. This is of special interest for applicants holding substantial wealth and interests abroad Spain (i.e. HNWIs), which would go untaxed by Spain.
A flat tax rate of 24% on any income derived strictly in Spain.

Please contact us if you wish to pursue a DNV. This visa is attained by us in under 3 weeks.

Suitable for:

• Teleworkers
• Digital nomads
• Self-employed (freelancers) who manage their business remotely
Further reading: Tax Advantages of Spain’s Digital Nomad Visa

3. Marriage Visa – EU Family Regroupment

It’s intended for families or couples that have been separated, in and out of the EU. It seeks to reunite them in an expedited manner within the EU. So, although this type of visa is popularly dubbed as ‘Marriage Visa,’ it would rather be more appropriate to label it as ‘Family Visa’. Unfortunately, the term 'Marriage Visa' has caught on and sounds more catchy, so we will just stick to that for simplicity's sake.

Its scope goes well beyond a married couple. It ought to be understood in broader terms, as in family reunion. As its own name implies, couples must be married (including same-sex partners), this is the core requirement. Alternatively, it can also be a civil partnership. This visa allows you the right to work in Spain. This visa is fast-tracked, we can get it in one month.

Suitable for:

Separated family members that wish to reunite within the EU
Married couples

Further reading: EU-Family Regrouping (Marriage Visa)

4. Business Visa – Lucrative Visa

As its own name implies, this permit allows the applicant to work in Spain as you will be self-employed. This residency applies to someone who is looking to set up his own business in Spain. Typically, you will be acting as a director or managing director overseeing the company. Needless to say, one of the key requirements is that you will have enough means to be self-supporting, both for yourself and your family for one year.

The catch, besides a cast-iron motivation, is that you need to invest in the ballpark of €80,000 to €100,000 to open & run a business in Spain. You will also be required to hire employees (the cornerstone of this visa). This visa allows you the right to work in Spain as self-employed.

Suitable for:

Applicants (families) wishing to set up and run a business in Spain
Self-employed
Dauntless entrepreneurs

Further reading: Lucrative residency permit (Business Visa)

5. Non-Lucrative Visa – Pensioner’s Visa

As its own name implies, this visa allows applicants to live, but not to work, in Spain. If you are working, or plan to work in Spain, you will be stripped of this visa. Only pensioners should apply for it.

The applicant will be expected to be self-supporting and will be required to prove he or she has enough savings for at least two years. This visa is ideal for retirees who wish to spend extended periods of time in Spain – without working – enjoying the finer things in life.

This visa is available from us from only £300.

Suitable for:

Pensioners
Would-be buyers, long-term tenants
Bon vivants

Our law firm has a track record of 100% attaining Spanish visa & residency permits since 2013. We have assisted hundreds of individuals and their families.

Residency services available from LNA:

Golden Visa Service (Investor Visa)
Non-Lucrative Visa (Pensioner’s Visa)
Lucrative Visa (Business Visa)
EU-Family Regroupment (Marriage Visa)
Digital Nomad Visa (Tax-free visa)
Non-Domiciled Tax Scheme (Beckham's Rule)
Spanish Residency permit for EU nationals

At Larrain Nesbitt Abogados (LNA) we have over 21 years’ experience specializing in immigration & residency visas. We also assist clients buying, selling, or renting properties in Spain. You can contact us by e-mail at info@larrainnesbitt.com, by telephone at our UK line (+44) 0754 3838 218 or Spanish line (+34) 952 19 22 88, or by completing our contact form.

Larraín Nesbitt Abogados, small on fees, BIG on service.
2024 © Raymundo Larraín Nesbitt. All Rights Reserved.

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How to file a 3% tax rebate on the sales proceeds of your Spanish property

Raymundo Larraín Nesbitt, April, 3. 2024

Raymundo Larrain explains how a non-resident seller is entitled to a tax rebate on his sales proceeds

Marbella-based Larraín Nesbitt Abogados (LNA) has over 21 years’ taxation & conveyancing experience at your service. We offer a wide range of 50 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain.

You can review here our client’s testimonials.

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Abogados
8^th of April 2024

Introduction

Non-residents selling property in Spain undergo a 3% retention which is practised on the sales proceeds. This money is withheld by the buyer (or his lawyer) which is then transferred to the tax office.

Unbeknownst to most people, sellers are legally entitled to apply for a tax rebate on the full 3% of the sales proceeds providing they have sold at a loss, or have broken even.

This procedure is technical, meaning it requires the input of a seasoned lawyer to file this tax rebate (a seller cannot do this on his own).

Additionally, a seller is also entitled to legal interest when the tax office takes longer than usual to repay the withheld sales proceeds. This can be rather substantial, and most certainly higher than what any high street bank is paying savers nowadays for their deposits!

Surprisingly, most sellers are oblivious to this rebate and never bother to ask for their money back, which is lost!

3% retention explained

The purpose of this retention is to act as guarantor of a seller’s Capital Gains Tax liability on selling property in Spain. If a seller makes a profit, he must pay CGT. The 3% ensures sellers will not be doing a ‘runner’.

However, not all sales make a profit. Moreover, you would be surprised to learn that after adding all the associated costs and expenses most sellers are breaking even! Which would mean they are all entitled to apply for this tax rebate.

When you add up the associated conveyance expenses (both on buying and selling the property), the associated taxes, professional fees due (estate agent, notary, land registry, lawyer), and improvements on the property over time it is often the case that sellers are breaking even, or even making a loss, however small.

When you sell at a loss, or break even, the 3% retention is no longer justified legally. Meaning, the seller has a legal right to claw it back from the Spanish Tax Office, plus interests on top!

Procedure

As mentioned, on selling property in Spain, a 3% retention is practised on the non-residents’ sales proceeds at completion. For example, on selling a €500,000 house, €15,000 will be withheld by the buyer at the notary’s office.

Following completion, this retention is paid by the buyer to the tax office.

Depending on whether a profit or loss was made, the seller’s lawyer can apply for a tax rebate on the full, or part of the €15,000. Additionally, contingent on how long the tax office takes to pay the rebate, legal interests accrue, which can be quite substantial over time.

Law firm LNA helps you getting your money back

At LNA, we have assisted thousands of sellers getting their money back over the last two decades.

We offer the following competitive tax service: Calculating seller’s taxes

We offer a highly demanded tax service to calculate seller’s taxes (Capital Gains Tax and Plusvalia Tax) without having to instruct us on the conveyance. This includes filing a seller’s 3% tax rebate.

You can of course also hire us to handle your conveyance too, we act all over Spain.

Our team of pro-active lawyers will get your money back within months.

Our fee is tax-deductible from your seller’s taxes, meaning you pay even less taxes!

Conclusion

If you plan to sell your property in Spain, and you are a non-resident, you can contact us to recover your money in a timely manner.

Don’t let your money go to waste! It is your seller’s right to recover this money, your money.

Because every penny counts.

Contact us at LNA if you need us to calculate your seller’s taxes, and/or want us to file a tax rebate for the 3% on your behalf. Tax rebates are usually paid within months.

“Steinway grand pianos are the best in the world.” — Maurizio Pollini

Maurizio Pollini (5 January 1942 – 23 March 2024). Was an Italian pianist and conductor. He was known for performances of Mozart, Beethoven, Chopin, Debussy, among others. A staunch left-wing activist in the 1960s and 1970s, he would remain politically engaged in later life. He maintained a separation between his ideals and his music magic. Maestro.

Related tax and legal services available from LNA:

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Luxury rentals in Spain explained

Raymundo Larraín Nesbitt, March, 4. 2024

Lawyer Raymundo Larrain explains luxury rentals and their unique legal advantages.

You can review here our client’s testimonials.

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Abogados
8^th of March 2024

You are probably aware of Spain’s Tenancy Act (LAU, in Spanish). This law is somewhat infamous because it (over)protects tenants (read biased) at the expense of landlords’ rights. The logic behind this is that lawmakers view tenants as the weak party in need of protection. Thus the LAU is heavily biased towards tenants to the point it crosses a thin red line and may even act as a deterrent cutting down the supply of suitable rented accommodation (specifically long-term), which in turn drives rental prices further up harming tenants. The law of demand and supply at work.

You will have likely heard that *all* long-term rental contracts in Spain are subject to the LAU, right? Well, not true. Meaning landlords can take advantage of legal loopholes to neatly circumvent lenient LAU tenant entitlements. Nuances are at play.

A number of rental contracts fall outside the remit of Spain’s Tenancy Act, such as seasonal contracts, holiday rentals, accommodation for military personnel, luxury rentals, and more. Today’s short article is going to focus on the latter, on luxury rentals. Known in Spanish as alquileres suntuarios.

In plain English, luxury rentals fall outside of the scope of Spain’s infamous LAU, which opens up a slew of advantages for landlords. In effect, luxury rentals give landlords the upper hand, as they are able to legally override all the pesky tenant entitlements laid out in the LAU.

What conditions need to be met for a rental contract to qualify as a luxury rental?

In short, either of the two:

The property rented is 300 m², or larger.
The monthly rental exceeds 5.5 times the average minimum wage. For 2024, that’s a €7,300/month rental.

If one, or both, of the above conditions are met, the rental contract is excluded from the protection of the LAU.

What legal significance does this have?

In short, a lot.

Basically, it means that all the thoughtful entitlements the LAU meticulously lays out for the protection of tenants do not apply. Meaning landlords are greatly favoured because all the lenient entitlements and rights the LAU rules on are waived legally, leaving the contract to be ruled only by the will of the parties. The legal significance of this is huge, as it basically conveys a huge leverage to landlords, if they play their cards right.

This is done because our lawmakers surmise that a luxurious rental contract is signed by a tenant who is either a shrewd businessman or an affluent person; either way someone who does not warrant the protection of our (biased) tenant laws, such as the LAU.

Advantages of luxury rentals: practical examples

Unlimited security deposits. Standard long-term contracts, subject to the LAU, are capped at a one-month security deposit (fianza, in Spanish). In luxury contracts, landlords are free to demand, for example, the equivalent of a full year’s rental in advance, or more, as a security deposit.
Freedom to terminate contracts. In standard long-term contracts, subject to the LAU, you can pull out only after 6 months have passed. In a luxury contract, you may pull out at any time, even on the following day.
Heavy penalties apply to early terminations. Following on the above point, in a standard long-term contract it could be agreed that if a tenant pulls out after 6 months a capped penalty applies which equates to the months left to complete a full year, on a pro rata. That, by law, would be the maximum. However, on luxury contracts there is total freedom; a tenant could be liable for all the rentals left to complete a full year. I.e. over €100,000 if you pull out a week after signing for whatever reason!
Standard eviction rules do not apply – evictions are (greatly) expedited. As opposed to standard rental agreements, where a tenant is regarded as the weak party and in need of legal protection, in luxury rentals both parties are viewed and treated as equals. This translates in practice to landlords being able to instigate fast-tracked eviction procedures that only last a couple of months, as opposed to standard ones, which under new laws, can take up to several years. In short, evicting tenants in luxury rentals follows an expedited procedure that lasts months, not years.

Conclusion

If you plan to sign up for a luxury pad in Spain, whether a villa or a penthouse, you are strongly advised to take legal advice before signing on the dotted line. Spending a few hundred euros in a lawyer’s advice can save you from losing, or being sued, over €100,000, or more!

From a landlord’s perspective, luxury rentals are a win-win. The freedom this type of contract confers landlords on wording clauses cannot be overstated enough. Landlords are normally constrained to work within the narrow legal framework and limitations of the LAU in standard lease agreements. By contrast, luxury rentals allow total freedom to landlords, placing them in a position of great power.

Related legal services available from LNA:

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8 reasons to buy property on the Costa del Sol

Raymundo Larraín Nesbitt, February, 7. 2024

You can review here our client’s testimonials.

Featured: Marbella, Andalusia’s tourist flagship.

Article copyrighted © 2024. Plagiarism will be criminally prosecuted

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Abogados
21^st of February 2024

The Costa del Sol (Málaga) remains a prime location for the foreign worldwide community, attracting millions of visitors every year for a host of reasons collated below. Marbella, Málaga, Benahavís, Benalmádena, Mijas, Estepona, and more, are all household names in the real estate market.

Although a hike in interest rates has indeed taken a toll on the real estate market, the Costa del Sol’s unique advantages, listed below, contribute to making it a resilient market where properties stand to lose little, and gain much, with the turn of each economic cycle. The underlying reason for this is mainly the always high demand for accommodation in this sought-after area which in turn piles pressure on property prices, increasing year on year.

The Costa del Sol is an ideal place for Digital Nomads or Golden Visa applicants to settle in, alone, or with their families.

Eight reasons to buy property on the Costa del Sol

(Still) affordable property prices. When you compare property prices, they are still far cheaper by rapport to the United Kingdom. For the same amount of money that buys you a semi-detached in the UK in a poor location with no views, you get to buy a gorgeous villa on the Costa del Sol with commanding views over the sea, a mature garden, and still have money to spare on a property makeover! Then there is also the little fact that property prices are appreciating by two digits on the Costa del Sol. Life is all about choice.
A pleasant all-year-round climate. Whilst in Nordic countries, like the UK, you can expect 200 days of miserable rain, the Costa del Sol boasts 300 days on average of sunshine a year. This gorgeous weather is precisely what gives it its namesake. Light and warmth are never too far away!
Ultra-low taxation. As explained in our taxation articles, Andalusia’s new regional government is hell-bent on pro-low taxation. They have introduced significant tax breaks on buying property (almost) turning it into a tax haven. This political agenda translates into the lowest taxes in all of Spain, on Inheritance and Gift Tax, on Wealth Tax (was suppressed in 2022), on Property Transfer Tax, and Stamp Duty which were both slashed. So much so, that most taxpayers pay nil on IHT (including non-resident and non-EU taxpayers). Inherited estates under one million euros (per taxpayer) are tax-free for next-of-kin which includes both descendants (children) and ascendants (parents, grandparents). Over one million is taxed at only 1% on the excess. If you invest on a buy-to-let, landlords can save 70%, or more, on their tax bill. On long-term rentals, you can expect a net annual yield of 5%, on tourist rentals you can expect a net yield of 10%. Spain approved this month, besides a generous 5% increase to the minimum wage which applies nationwide, a personal allowance of €15,876 per taxpayer on income tax. In plain English, the first €16k you earn in Spain is tax-free. Yay!
A privileged lifestyle. The Costa del Sol spoils you for choice, as it caters to all tastes: whether you enjoy taking in its beautiful unspoiled scenery, wandering through its pristine mountains and Mediterranean pine forests, going out on a fancy dinner, practising sports, sunbathing on the beach, night-time clubbing for party owls, skiing (Granada is only a two-hour drive), or feeling the flutter of placing a wager (Marbella’s Casino), or simply chilling out al fresco sipping a glass of a fine Rioja while you watch a dramatic sky dusk against a dashing blue sea in good company. The Costa del Sol simply has it all!
Excellent modern connections. Malaga’s airport, Gibraltar’s airport, a modern rail network, modern highways, Malaga’s upgraded port, all help to connect Malaga to the modern world.
First-class amenities. Lavish restaurants, luxury shops, trendy designer boutiques, refined theatres, glam discotheques, 18 and 9-hole golf courses, international private schools, and exclusive yacht-filled marinas (Puerto Banus, Cabopino, La Duquesa, Sotogrande). Your problem is that won’t have enough time to enjoy it all!
Quality healthcare. Malaga offers several state-of-the-art hospitals that will cover your every health need. There are also specialised beauty medical facilities that assist enhancing your physique, because everyone deserves a little nip and tuck. For those in the know!
A vibrant cultural life. Malaga’s vast cultural offering spans from the Picasso Museum, Pompidou Museum, Carmen Thyssen Museum, Saint Petersburg’s Russian Museum, the bullring, to a slew of glam theatres, such as the trendy Teatro del Soho. Music concerts and refined classical music galas featuring world-renowned artists are all organized by Starlite during the long summer season. All these contribute to giving the Costa del Sol the lustre of a cosmopolitan venue. But if we dig deeper into its historical roots, history buffs will get lost in Malaga’s Roman and Carthaginian ruins, Augustus’ two-millennia-old amphitheatre and the imposing one thousand-year-old Moorish Citadel await to capture your imagination!

Are you ready to be spoiled? Invest and live on the Costa del Sol, live the dream!

Conclusion

Larrain Nesbitt Abogados (LNA) offers a competitive conveyance service. Our English-spoken lawyers and economists handhold you throughout the entire purchase procedure. We also assist you filing taxes and applying for visa or residency permits.

You can read here our free property guide kindly hosted by SPI.

You only live once, make the most of it.

“Action is the key to success.” – Pablo Picasso.

“La acción es la clave fundamental de todo éxito.”

Pablo Ruiz Picasso (1881 – 1973). Málaga-born, he was a Spanish painter, sculptor, printmaker, ceramicist, stage designer, poet, and playwright who spent most of his adult life self-exiled in France. Regarded as one of the most influential artists of the 20th Century, he is credited for co-founding the Cubist movement. A child prodigy, Picasso achieved universal renown and immense fortune for his revolutionary artistic accomplishments, becoming one of the best-known figures in 20th-century art. He was a prolific artist who left behind thousands of works of art. Perhaps his most iconic piece was the 1937 Guernica painting which depicts the horrors of war and foreshadowed the dark days of WWII (exhibited in Madrid, Centro de Arte Reina Sofía). Picasso was one-of-a-kind, une force de la nature, a towering artistic figure who casts a long shadow over every other artist that has followed in his wake.

Related conveyance services available from LNA:

Please note the information provided in this article is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. Ní neart go cur le chéile. Voluntas omnia vincit.

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Spain’s Digital Nomad Visa

Raymundo Larraín Nesbitt, January, 8. 2024

Inset photo: James, busy at work from his Spanish ‘office’ (tie is optional)

You can review here our client’s testimonials.

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Abogados
8^th of January 2024

Introduction

Spain’s new Digital Nomad Visa (DNV) has taken the visa market by storm! Fancy working remotely from a beach in Spain, sipping a mojito with 21 degrees in good company paying almost no tax (*)? The DNV has you covered!

The DNV offers unique tax advantages that no other Spanish visa can hope to match, not even a coveted Golden Visa. Its main outlier, and what distinguishes it from other available visas, is precisely the wide array of tax benefits it offers. The DNV has been purposely devised so successful applicants pay few taxes in Spain; the purpose is to incentivize overachievers to relocate and work (remotely) in Spain.

The DNV is modelled after Beckham’s Rule, enacted in 2015, and which applies to EU nationals which in turn was inspired by the UK’s wildly popular Non-Domiciled taxpayer scheme. The DNV applies to non-EU nationals and offers basically the same tax advantages as Beckham’s Law.

It’s a legal fiction whereby a non-EU taxpayer is treated as a non-fiscal resident in Spain, but for administrative purposes, they are regarded as fully resident in Spain. The tax significance of this nuance simply cannot be understated enough and opens the door to a slew of tax benefits I collate below.

(*) Precisely because of its huge tax advantages, the law time-gates them to a maximum of five years plus one.

Needless to say, a DNV makes you tax resident in Spain (that’s precisely the whole point!).

Because of its nature (to attract talented individuals), and similar to Golden Visas, all DNV applications are fast-tracked. In under 3 weeks you know if your application has been successful.

In a nutshell, the DNV is all about paying (very) low income tax, or none at all (as assets & interests held abroad Spain go untaxed!)

DNV tax benefits

All income & assets held abroad go untaxed. In other words, any source of worldwide income is tax-exempt (just like with the popular UKs non-dom tax scheme). The only exception is any income derived abroad from working.
DNV holders only pay tax strictly on the income they derive working remotely in Spain for a foreign employer. They will pay a flat tax rate of 24% on the first €600,000 of gross annual earnings over a five-year period.
They are not required to file a 720 tax return (unlike Spanish tax residents)
They are not required to file Wealth Tax (unlike Spanish tax residents)
You can request to defer the payment of tax on the first and second year without penalties or delay interests being rolled on top (as is standard)
For the purposes of other tax agencies, you are considered tax resident in Spain.

General staple requirements

Non-EU national.
Hire private health insurance from an approved health provider in Spain (you need to be under 75 years old), or
Enrol in the Social Security
Clean criminal record (previous 5 years).
Be self-supporting (you will not claim benefits from the state): you need to show a minimum bank balance of €34,000/year for the main applicant. A further €8,400/year for every dependent.
Not be already in Spain illegally at the time of making a visa application.

DNV specific requirements

If employed, you need to prove you are hired by a foreign company. You need to have been working for this employer for at least 3 months prior to making a DNV application. A work contract is the core requirement (12 months, or more). A copy of your job contract will be required. Alternatively, if self-employed (freelancer), a letter from the company stating you are self-employed, and company records proving it has been operational for over 12 months.
You need to supply a copy of holding formal academic qualifications i.e. a university degree, business school, or professional qualification, or,
alternatively, you need to prove you have at least 3 years of work experience in the job position you are being hired for.
Not to have resided in Spain during the previous 5 years of making an application.
Not to obtain income from a permanent establishment in Spain.

LNA has a 100% track record attaining Spanish residency

At Larrain Nesbitt Abogados, we have assisted hundreds of non-EU nationals, and their families, to successfully attain a Spanish residency permit since 2013.

Interested? Come and speak to Larraín Nesbitt Abogados’ friendly staff who will be pleased to guide you through the different residency options, choosing the one that appeals to you most.

Your family’s success is only one call away: (+44) 07543 838 218, or (+34) 952 19 22 88.

Larraín Nesbitt Abogados, small on fees, BIG on service.

Residency services available from LNA:

Golden Visa Service (Investor Visa)
Non-Lucrative Visa (Pensioner’s Visa)
Lucrative Visa (Business Visa)
EU-Family Regroupment (Marriage Visa)
Digital Nomad Visa (Tax-free visa)
Non-Domiciled Tax Scheme (Beckham's Law)
Spanish Residency permit for EU nationals

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Spain’s Golden Visa: 10 reasons to apply

Raymundo Larraín Nesbitt, December, 1. 2023

Lawyer Raymundo Larraín highlights the main advantages of Spain’s Golden Visa.

Marbella-based Larraín Nesbitt Abogados (LNA) has over 21 years’ taxation & conveyancing experience at your service. We offer a wide range of 50 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain.

You can review here our client’s testimonials.

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Abogados
8th of December 2023

Introduction

Spain has undergone a spectacular property boom over the last 8 years, only marred by the Covid pandemic in 2020. In coastal areas and large cities, properties have almost tripled in price since 2015.

During this time, the Spanish Government introduced two new immigration schemes which have rocked the game board: Beckham’s Law in 2015 and the Digital Nomad Visa in 2023. Both mirror each other; the former is devised for EU nationals and the latter for non-EUs. They introduce a swathe of enticing tax advantages with an aim to attract foreign talented individuals, both from the Union and non-EU. Over 10,000 people benefit from Beckham’s Law lenient tax breaks (which apply nationwide, regardless of where you settle down in Spain).

We learned in a post-pandemic world that working remotely is not only a possibility, but frankly a necessity for many. For those who are able to escape the foul weather of their home countries, and seek the warmth and light of milder climates, all year round, coupled with ultra-low taxation, these new immigration schemes prove a temptation too hard to resist. So, why even fight temptation? It’s simply smarter to give in.

Starting life anew abroad is a compelling idea that lurks in the minds of millions day to day. But in reality, only a handful musk the courage to break away from the constraints of narrow-minded traditional work moulds that hearken back to previous centuries. Working remotely from Malaga on your laptop with 21 degrees, whilst paying little to no tax, is no longer an unreachable dream, it’s a reality made true for thousands of individuals. Break away from the heavy chains of social conventionalisms, and carve your own path in life, embrace a new lifestyle befitting of the 21^st Century.

However, despite the roaring success of the above two immigration schemes, the undisputed king of all visa permits still remains to this day the coveted, and often elusive, Golden Visa, introduced in 2013. It is the only visa in Spain which does not make you automatically tax resident on attaining it. The unmatched freedom and choice it confers its privileged applicants cannot be overstated enough. It’s a blue-ribbon visa that throws the red rug at their feet allowing them unfettered access to Spain and the Schengen Area beyond (27 countries).

Law firm LNA gets you, and your family, a golden visa in under 3 weeks.

Capture-arabic

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10 reasons to apply for a Golden Visa in Spain

Tax - A Golden Visa does not automatically make you tax resident in Spain, unlike every other visa in Spain. This is a unique trait exclusive only to GVs. No other visa in Spain shares this unique (tax) advantage. Only for this reason, affluent investors find it most appealing.
Freedom - Allows you to override the 90/180-day that limits stay in Spain (and by extension the Schengen Area/European Union).
Autonomy - Allows unfettered access to Spain. You can enter and leave the country as you please, even overriding Covid flight bans, as you will hold a select residency permit that (very) few people have.
Choice - No minimum stay is required. You can spend as little as one day, or the full year-round in Spain, at your choice.
Clear rules - Initially on a 3-year stay, then on 5-year renewals.
Family – all are included as dependents.
Fast-tracked. Golden visa applications are greatly expedited by rapport to standard visa applications. Golden visas are granted in 3 weeks.
Work - You can work in Spain. Unlike other visas, which ban you from working in Spain, it allows you and your family the right to work in Spain (optional).
Leads to permanent residency (optional).
Leads to Spanish citizenship (optional).

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Conclusion

Control your own destiny, pay less taxes, and enjoy with your loved ones a new life in a beautiful country at the heart of Western Europe.

Interested? Come and speak to Larraín Nesbitt Abogados’ (LNA) friendly staff who will be pleased to guide you through Spain’s Golden Visa programme. On applying for a Golden Visa, we assign you one of our seasoned immigration lawyers, who will be assisted by an in-house visa specialist, guiding and handholding you throughout the whole procedure, from start to finish.

Did I mention LNA attains Golden Visas in under 3 weeks?

Life is simply too short not to be lived.

For those few who want to make the most out of it:

Golden Visa (Investor Visa)

At LNA we have made true the dreams of hundreds of non-EU investors, and their families, assisting them to attain a Golden Visa since its inception in 2013. You can browse our clients’ visa testimonials here.

Your family’s success is only one call away:

UK: (+44) 07543 838 218

Spain: (+34) 952 19 22 88

“The only way to get rid of a temptation is to yield to it.” – Oscar Wilde

Oscar Fingal O'Flahertie Wills Wilde (1854 – 1900). Was an outstanding and brilliant Irish poet and playwright. He is best remembered for his epigrams and plays, and his novel The Picture of Dorian Gray, featuring the soulless ever-young Victorian aristocrat. My personal favourite is The Selfish Giant. He died young, incarcerated by narrow-minded social conventionalisms, both figuratively and literally, he was unable to escape. Simply, he was one-of-a-kind.

Residency services available from LNA:

Golden Visa Service (Investor Visa)
Non-Lucrative Visa (Pensioner’s Visa)
Lucrative Visa (Business Visa)
EU-Family Regroupment (Marriage Visa)
Digital Nomad Visa (Tax-free visa)
Non-Domiciled Tax Scheme (Beckham's Law)
Spanish Residency permit for EU nationals

Please note the information provided in this article is of general interest only and is not to be construed or intended as a substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. No pact with the devil was made on writing this article. Ní neart go cur le chéile. VOV.

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Beckham’s Rule explained (Spain’s Non-Domiciled Tax Scheme)

Raymundo Larraín Nesbitt, November, 1. 2023

Lawyer Raymond Nesbitt explains to us one of four legal ways to bypass the pesky 90/180-day rule that now affects all UK nationals post-Brexit.

Marbella-based Larraín Nesbitt Abogados (LNA) has over 20 years’ taxation & conveyancing experience at your service. We offer a wide range of 50 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain.

You can review here our client’s testimonials.

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Lawyers
1st November 2023

In 2015, Spain introduced a special tax regime for wealthy EU/EEA expatriates who relocate to Spain. Following in the footsteps of other countries’ successful non-domiciled tax schemes, namely the United Kingdom, the self-declared goal of this programme is to attract high achievers to relocate to Spain on the back of a job offer. The typical taxpayer profile that qualifies would be a high-profile artist, techy, high-ranking corporate employee, etc. Over 10,000 foreigners settled in Spain have benefitted from this special tax arrangement.

In a nutshell, this tax scheme allows EU/EEA nationals to make spectacular tax savings on paying Income Tax in Spain (IRPF). If you opt into this scheme, you stand to benefit from substantial tax breaks on both income derived in Spain as well as worldwide income.

On opting into this special tax regime, a legal fiction takes place whereby EU expats are treated (for admin purposes) as if they are a resident taxpayer in Spain. Albeit in practice, for tax purposes, the taxpayer is regarded as a non-resident. Meaning you in fact get the best of both worlds; you get all the perks from being legally resident in Spain, yet you pay a substantially lower tax bill as you are deemed in practice as a non-resident taxpayer.

Who can apply?

Any European Union national relocating to Spain as a result of a professional contract. You need to be hired by a Spanish company or else by a foreign company with a permanent establishment in Spain. The contract is the core requirement to opt into this tax scheme. Non-EUs may also apply but may require a visa to live and work in Spain. Non-EUs are advised to benefit instead from a Digital Nomad Visa, which offers almost identical tax benefits and is also a visa permit.
Not to have resided in Spain on the previous 10 years.
No earnings derived from a permanent establishment in Spain.

The tax benefits

Spanish income. The first €600,000 earned from a source within Spanish territory will be taxed at a flat rate of 24% (in lieu of the standard top marginal rate of 47%). As can be surmised, even for earnings whose source is derived exclusively in Spanish territory, the tax savings are huge.
Worldwide income. However, it is here where this tax scheme truly shines and comes into its own. Spanish Tax Authorities only tax you on your income derived within Spanish territory. Meaning, any other source of worldwide income is tax-exempt (just like with the popular UKs non-dom tax scheme). Needless to say, this unique tax advantage offers a hugely attractive prospect for those taxpayers with substantial earnings, assets, and interests overseas. The only exception is any income derived abroad from working.
Exempt from submitting tax return 720
Exempt from submitting wealth tax *
Five years plus one. Because of its outstanding tax advantages, the government time gates the tax benefits. It applies on the fiscal year of relocation as well as on the following five years (total up to six years).

*contingent on the value of your Spanish estate.

Potential disadvantages

As written above, a legal fiction applies whereby you are regarded as a non-resident taxpayer (non-domiciled). The implication of this is that as you are not regarded as a tax resident, you may not benefit from lenient tax allowances on personal income tax as would be standard practice.
This tax scheme only works out if the taxpayer's country of origin has a double taxation treaty in place with Spain.

Conclusion

Beckham’s Rule addresses a gap for high-end professionals who wish to relocate to Spain (on the back of a job contract), alone or with their families, and enjoy all the country has to offer, including ultra-low taxes, regardless of where they settle down in Spain i.e. in Mallorca.

If you are a high-flyer, don’t fancy paying many taxes, and wish to relocate to Spain (legally), this is the tax scheme for you. Give us a call!

In effect, this blue-ribbon tax scheme allows you, and your family, to get the best of both worlds; you get to enjoy all the perks of being legally resident in Spain albeit you are fiscally treated as a non-resident taxpayer, paying little to no tax. In my book, that’s a win-win.

At Larrain Nesbitt Abogados, we offer the following immigration service: Beckham's Rule

“I don’t do anything unless I can give it 100%.” – David Beckham

David Robert Joseph Beckham (1975). OBE. Born in a humble background, from a young age he became a footballer, quickly rising through the ranks given his innate talents, becoming England’s captain. He retired after a very successful 20-year career, during which he won 19 major trophies. He married a spicy posh businesswoman, and they’ve had four children. He’s a known philanthropist who has created several football academies to benefit children who come from deprived backgrounds. Surprisingly – and most annoyingly – he hasn’t been bestowed (yet) the title of ‘Sir’, despite others attaining it with half of his accomplishments.

Residency services available from LNA:

Golden Visa Service (Investor Visa)
Non-Lucrative Visa (Pensioner’s Visa)
Lucrative Visa (Business Visa)
EU-Family Regroupment (Marriage Visa)
Digital Nomad Visa (Tax-free visa)
Non-Domiciled Tax Scheme (Beckham's Rule)
Spanish Residency permit for EU nationals

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Spain’s Non-Lucrative Visa Explained (Pensioner’s Visa)

Raymundo Larraín Nesbitt, October, 9. 2023

Lawyer Raymond Nesbitt explains to us one of four legal ways to bypass the pesky 90/180-day rule that now affects all UK nationals post-Brexit.

You can review here our client’s testimonials.

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Lawyers
8^th of October 2023

The non-lucrative visa has proven wildly successful over the last few years. The typical applicants are a retired couple who wish to spend their twilight years enjoying the very best of the gorgeous Spanish weather & fine food at affordable prices.

Please note this visa service is only open to non-EU residents (i.e. British). NLVs make you tax resident in Spain.

NLV general requirements

Not to be already in Spain illegally at the time of making the application.
Clean criminal record (previous 5 years).
Hire your own health or medical insurance (full coverage) with a Spanish healthcare provider (applicants must be under 75 y.o. to apply).
€34,000/year in savings for the main applicant. For every additional dependant, you need to add a further €8,400/year.
You must not suffer from any of the diseases that may have serious public health repercussions.
Proof you can secure accommodation in Spain.
You cannot work in Spain, you can also not be working at the time of making the application.

LNA offers the following visa service (Ts & Cs apply): Non-Lucrative Visa

What’s holding you back from enjoying a well-earned retirement? Give us a call.

You can call us at our UK line: (+44) 07543838218

LNA has a 100% track record of attaining Spanish visas & residency permits

Larraín Nesbitt Lawyers, small on fees, big on service. Your family’s success is only one call away: (+44) 07543838218.

At Larrain Nesbitt Abogados, we have assisted hundreds of EU and non-EU nationals to successfully attain Spanish residency permits & visas.

Interested? Come and speak to Larraín Nesbitt Abogados’ friendly staff who will be pleased to guide you through the different residency options, choosing the one that appeals to you most.

Other residency services available from LNA:

Golden Visa (Investor Visa)
Digital Nomad Visa
Lucrative Visa
Non-Lucrative Visa
Marriage Visa
Spanish Residency permit for EU nationals

... Read more