If you’re a self-employed individual looking to relocate, Spain may just have become your new top pick. Thanks to the Beckham Law, an updated tax incentive package for foreign workers in Spain, self-employed individuals can now benefit from some major tax breaks that make it even more appealing to move abroad. Join us as we explore why so many people are considering making the move to sunny Spain and how the Beckham law is changing the game for independent contractors all over Europe.
Tax Benefits of the Beckham Law
Spanish self-employed people are benefiting from a new tax law that was passed in December of 2013. This law changed the way self-employed income is taxed in Spain, which makes it a much more attractive option for those looking to start their own business. Here are some of the key benefits of this law:
1. No capital gains or losses on self-employment income: Previously, self-employed people would experience capital gains and losses on their income, which could be quite burdensome. Under the new law, however, self-employed income is taxed only on its actual value. There are no additional taxes on profits or losses, so self-employed people can avoid having to pay large amounts in taxes every year.
2. Reduced tax rates for all self-employed individuals: The new law reduces the tax rate for all self-employed individuals by 20%. This means that even if someone’s income is low starting out, they will still benefit from this reduction in taxes over time.
Self-Employed People Move to Spain
Spaniards are moving to self-employed positions in record numbers since the new tax benefits of the Beckham law requirements went into effect. The new law allows individuals to deduct their business expenses from their personal income, which has created a huge incentive for people to become self-employed. This has especially been true in Spain visa for freelancers, where taxes are high and wages are low.
The Beckham law is a major reason why Spain has seen such a surge in self-employment, as it provides significant financial benefits for those who choose to go this route. For example, someone who earns €30,000 as a salaried employee can deduct €4,000 annually from their income. However, if that same person becomes self-employed and does not have any employees, they can deduct all of their business expenses from their taxable income, which amounts to €8,000 annually. This means that the potential savings on taxes alone could be worth pursuing a self-employment career in Spain.
However, there are also many other reasons why Spaniards are choosing to become self-employed. For example, most Spaniards don’t enjoy working for large corporations or bureaucratic governments. As a result, many people have chosen to start their own businesses because it is more flexible and allows them greater control over their work lives. Additionally, being self-employed doesn’t require paying high taxes like most jobs do in Spain. In fact, according to research by Mercer Human Resource Consulting Spain , the average individual pays only 21%
The Golden visa
The Beckham Law, also known as the Migrant Workers Welfare Law, was passed in June 2013 and introduced a number of tax benefits for self-employed people living in Spain. These tax benefits include a lower income tax rate of 19%, an exemption from social security contributions and a reduced amount of taxation on profits. The law has had a significant impact on the number of self-employed people moving to Spain golden visa 2023, with figures from 2014 showing that there has been a 28% increase in the number of self-employed people living in Spain since 2013. One reason for this increase is that the new tax benefits make it much more affordable for self-employed people to live and work in Spain.
The Autonomo visa
The new tax benefits of the Beckham law have made self-employed people very happy in Spain. These benefits include a reduction in income tax from 43% to 20%, a reduced social security contribution rate of 12.5% for employees and self-employed people with an annual income up to €50,000, and an exemption from value added tax (VAT).
Some other key benefits of being self-employed in Spain include the ability to set your own hours, keep all the profits you make, and choose your own company name. This last point is important because it gives individuals more control over their lives and careers.
The digital Nomad visa
Spain has been a top destination for digital nomads for some time now. The country’s low cost of living, relaxed atmosphere, and abundance of co working spaces are among the factors that have drawn people here. But what’s really gotten people excited about Spain as a place to live and work is the new tax benefits of the Beckham law.
The Beckham law is a piece of legislation that was passed in 2017 by members of the Spanish Parliament. The goal of the law was to create more jobs in Spain start up visa by offering attractive tax benefits to businesses that move their headquarters or operational base to Spain. These benefits include a reduced income tax rate for companies with an annual revenue over $3 million, increased investment incentives, and exemption from property taxes for companies leasing space in Spain for at least five years.
Spain offers a variety of job opportunities
When Rebecca woke up on July 1st, 2016, she had no idea what she would be doing that day. Just a few months earlier, Rebecca had left her job in the United States as a software engineer to move to Spain and start her own business. She was excited about the prospect of being able to work for herself and make her own decisions without worrying about the bottom line.
Rebecca’s decision to leave her job and move to Spain was not easy, but it was worth it. In just a few short months, Rebecca has found herself with a new career as an entrepreneur in Barcelona. The Beckham law, which went into effect in January of this year, has made starting and running a business in Spain much more affordable and beneficial than it was before.
Under the old tax system, Rebecca would have paid approximately 36% of her income in taxes each year. With the new tax system, however, Rebecca only pays taxes on profits earned from her business—which is currently at around 10%. This means that even if her business does not generate any income for several years, she will still only have to pay taxes on the profits that she has made since January of this year.
Property prices in Spain are very affordable
Spain is one of the most popular countries for self-employed people to move to. The new tax benefits of the Beckham law make it a very affordable place to live and work. This law changes the way taxes are paid, so that self-employed people pay less in taxes than they would if they were employed. This makes Spain an attractive place to live and work for self-employed people.
Final Remark
The Beckham law is one of several recent moves by the Spanish government aimed at boosting entrepreneurship and bringing more jobs to Spain. Other measures include a reduction in business taxes and an increase in government spending on infrastructure projects. Together, these policies are expected to create up to 500,000 jobs by 2020.
As self-employed people increasingly see Spain as a desirable place to live and work, the number of Spaniards living as self-employed is likely to continue growing in the coming years.
