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MOVING TO SPAIN

Reader question: Can I be a non-resident for tax purposes with Spain’s non-lucrative visa?

The non-lucrative visa is one of the most sought-after methods third country nationals such as Americans, Chinese and now UK nationals use to be able to spend more than 90 days at a time in Spain. But does it involve having to become a tax resident?

Published: 19 July 2021 17:49 CEST
Updated: 6 November 2023 07:55 CET
Reader question: Can I be a non-resident for tax purposes with Spain's non-lucrative visa?
If you remain longer than 183 days in Spain, you are officially considered a tax resident. Photo: Selim Cetin/Pexels

Spain’s visado no lucrativo – colloquially referred to as the retirement visa in English-speaking spheres – is the preferred means for non-EU nationals with sufficient savings/income to get around the 90 out of 180 days rule. 

As the name suggests, your time and business in Spain has to be non-lucrative, so it’s not for people who intend to study, invest or work, but rather those who have the financial means to take care of themselves and their families, as well as their health costs. 

READ MORE: What you need to know about applying for Spain’s non-lucrative visa

So if you’re not working in Spain, surely you don’t need to pay taxes in Spain, right?

Surprisingly for some perhaps, you actually do. Spain’s non-lucrative visa is a residency visa, so you have to spend more than 183 days in the country for it to remain valid, especially if you want to renew it after the first year (the first visa lasts one year, the next two renewals last two, and after five years you can apply for a long-term visa). 

If you remain longer than 183 days in Spain, you are officially considered a tax resident.

Therefore, you have to pay income tax on your worldwide income and you should check if there are double taxation agreements between your country and Spain. 

If you buy a property in Spain, and especially if you let it out for part of the year, you will also be subject to tax. 

READ ALSO: What are the pros and cons of Spain’s non-lucrative visa?

It’s true that you could technically use this visa to spend more than 90 consecutive days but fewer than 183 and therefore not be considered a tax resident, but this isn’t a scheme that will necessarily work out for you in the long run. 

Keep in mind that Spanish migration officials will have a record of your visas and they may question why you keep having to reapply for the non-lucrative visa from scratch. 

If you want to spend more than 90 consecutive days in Spain without becoming a tax resident, Spain’s golden visa may be a better option for you, if you can afford it. 

This usually involves buying a property worth at least €500,000, and if you spend less than six months in Spain you will only have to pay taxes on your assets in Spain and won’t lose your residency either given your sizable investment (you’ll have to visit Spain at least once a year). 

However, spend more than half a year in Spain or have the main core of your economic activities in Spain and you will be subject to paying tax on your worldwide assets and income.

READ ALSO: How to make the most of Spain’s Golden Visa residency scheme

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For members

WORKING IN SPAIN

Can you work outside of Spain on the non-lucrative visa?

The non-lucrative visa is a popular choice for non-EU citizens who want to come and live in Spain, but there’s long been confusion over whether or not you can work outside of the country or not while you’re on it.

Published: 19 September 2024 10:24 CEST
Can you work outside of Spain on the non-lucrative visa?

The non-lucrative visa or NLV as it is often referred to, is a residency authorisation that allows non-EU foreigners to live in Spain.

As the name suggests, however, it’s non-lucrative, so it doesn’t give you the right to work here, instead you have to demonstrate that you have sufficient savings for yourself, as well as any family members you’re bringing with you. 

Many people claim that if you’re not actually working in Spain while on the visa, and if you’re work comes from abroad then it’s fine, but is it actually legal?

Online searches reveal many conflicting results with several sources saying you absolutely cannot work on the visa at all under any circumstances and others saying that you can and authorities simply turn a blind eye.

It used to be a big grey area because Spanish law didn’t specifically mention remote working. Spain’s General Immigration Regime stated that, while staying on the NLV:

  • You mustn’t work for a Spanish company
  • You mustn’t work for a Spanish employer
  • You can’t open your own business in Spain
  • Nor can you open a branch office in Spain

In terms of remote working specifically, the law did’t actually address it.

READ ALSO: Does Spain check if you’re working on the non-lucrative visa?

But, authorities seemed to suggest that you couldn’t work on it at all, under any capacity, due to their rulings and decision making.

According to Barcelona-based law firm Balcells: “During the pandemic (from 2020 onward), the vast majority of consulates started to reject applications from foreigners who clearly stated they wanted to start working remotely”.

“Or if the consulate sees that remote work is what you have been doing for the past months/years, your application may even get rejected too”.

In 2023, a Madrid court denied a Venezuelan national’s application for the non-lucrative visa because they continued to advertise their professional services on sites like LinkedIn.

These all support the fact that working, even remotely for another country is not allowed.

The amount of savings you have to prove for the non-lucrative visa in 2024 is €2,400 per month, which must come from passive income such as return on investments and rental income, rather than physically working.

READ ALSO: Non-lucrative vs digital nomad visa: Which one should you choose to move to Spain?

There is now even stronger legal evidence to support the theory that you can’t work remotely while on the NLV, with the introduction of Spain’s Digital Nomad Visa or DNV in early 2023.

The whole point of the DNV is to allow non-EU remote workers and freelancers to be able to live and work in Spain, so it would defeat the entire purpose of this visa if you were allowed to work remotely on the NLV.

The DNV in fact has many requisites to ensure the way in which remote workers can legally work here. For example, they have to have worked for the same employer for three months or more and any company they work for has to have been in existence for more than one year.

To apply for the DNV in 2024 you have to prove a monthly income of at least €2,646. While this is slightly more than the NLV, it does mean that you can continue working. 

READ ALSO: Does Spain accept savings for the digital nomad visa if earnings aren’t enough?

Many remote workers may have used the NLV option in the past, but today there is no excuse, you may as well just apply for the DNV instead.

As authorities are cracking down on NLV applications, it’s simply not worth the risk having your application denied if you plan to continuing working. If you’re found out and are not declaring your income properly too, you could end up with a hefty fine and be unable to renew your visa in the future. 

Therefore, if you want to work remotely for company outside of Spain, it’s best to forget the NLV and go straight for the DNV, which will ensure what you’re doing is truly legal.

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