Inside the callStartup Law” (Law for the promotion of the ecosystem of emerging companies, published), framed in the reform plan agreed with the European Union for the Recovery, Transformation and Resilience Plan, the legislator has given us an opening of a special regime that, until now, it was very specific and restrictive.
The special regime applicable to workers posted to Spanish territory, established in article 93 of the Personal Income Tax Law, essentially allows, under certain conditions and requirements, taxation for those persons who are legally considered as tax residents in Spain, the option to pay taxes under the rules of Non-Resident Income Tax. Beyond everything that it entails, in this article we are going to focus on the novelties that have allowed an opening of said regime, which was already limited, leaving out of its scope those who transferred a special employment contract, such as the case of professional athletes (due to the political conflict that the Beckham case generated at the time).
In the first place, and having as a reason the greater vital mobility generated by globalization and increased by the 2020-2021 pandemic, previous tax periods have been reduced from 10 to 5 in which those who wish to opt for this regime should not have been considered as tax residents in Spain, and may have been transferred to other countries and have returned to our territory.
Another novelty, also very important, is the possibility of extending, both to the spouse of the displaced person and to children under 25 years of age or disabled, the application of this advantageous regime, provided they have moved to our country at the same time as the requesting taxpayer (the posted worker) or at a later time, but before the end of the first tax period resulting from this application regime.
But the main novelty, even considering the two previously exposed to be very advantageous and positive, resides in the opening of the modalities of displacement admitted by the legislator. Prior to the publication of this law, the modalities accepted for the application of the regime were the transfer motivated by a job displacement (that is, with a contract signed with an employer in Spain) always documented with a letter or documentation confirming that it really was a displacement. Well, with the arrival of this update, another case is added to this assumption that is repeated a lot these days with the rise and increase of teleworking. Those workers who, without a letter of displacement, or without being ordered by the employer, provide their services remotely with the exclusive use of computer, telematic and telecommunication means and systems, may also opt for the special regime. Specifically, this circumstance will be understood to have been fulfilled in the case of employed workers who have a visa for international teleworking provided for in Law 14/2023 of September 27, supporting entrepreneurs and their internationalization.
The second detail that confirms the present opening resides in what, previously, constituted the other modality that covered the option for said regime: obtaining the status of administrator of a company in Spain. In this case, the option was restricted only to those cases in which said administrator did not hold any participation in the entity or that, if it did have participation, that determined the consideration of the entity as linked for the purposes of the provisions of article 18 of the Corporation Tax Law (maximum 25 percent). For those who wish to opt for the application of this regime from this year 2023, the novelty lies in the elimination of the percentage limitation of capital participation in the entity, being able to hold the administration and the status of majority shareholder. The only requirement or limitation to this circumstance is that the incorporated entity must not be considered as patrimonial for the purposes of article 5, section 2, of the Corporation Tax. In the event that the entity is considered patrimonial, the limitation of 25 percent participation in the capital will apply so that it can also opt for the application of the special regime.
In addition to these two novelties, and what was previously added in this article, from the update in the wording of the article in the law, two more cases arise in which the taxpayer can also due to the application of the regime, and directly related to the concepts and assumptions included in the Startup Law, which are the following:
- As a consequence of carrying out in Spain an economic activity classified as an entrepreneurial activity, in accordance with the procedure described in article 70 of Law 14/2013, of September 27, in the terms established by regulation.
- As a consequence of carrying out an economic activity in Spain by a highly qualified professional who provides services to emerging companies, with certain requirements and details.
In short, the scheme, which in cases approved by the Administration entails taxation for income obtained from a Spanish source at a fixed rate of between 24 and 47 percent (from 600.000,01 euros), supposes for those displaced taxpayers, and for those teleworkers who choose to establish their residence in our country, a scheme for 5 years that will undoubtedly be advantageous and attractive for talent.
At Tomarial we will be delighted to study and execute, where appropriate, your option file for the regime, analyzing the tax savings that it entails for you. Contact us and we will inform you of all the details.
Enrique Moreno
Associate Tax Area of Tomarial
