The trend is undeniable: more and more Belgians and Dutch are choosing to move south permanently or combine living in Belgium or the Netherlands with teleworking in Spain. Although the quality of life is rising, the tax reality often underestimated. Spain is no tax haven; those who emigrate without planning risk double taxation or unexpectedly high taxes on worldwide income and assets.
When do you become a tax resident in Spain?
You will be automatic tax resident in Spain if you more than 183 days per calendar year reside in Spain, or when the centre of your economic or vital interests is in Spain. From then on, you will be taxable in Spain on your global income and assets. This is a binary rule: there is little room for interpretation.
Expert insight: "Many Belgians and Dutch people wrongly think that as long as they keep their domicile in Belgium, they are safe. However, the Spanish tax authorities look at the actual situation. A water consumption that indicates permanent residence is for the Spanish tax authorities (Hacienda) is often enough evidence already."
The impact on your assets: Two taxes that hurt
For Belgians with significant wealth, there are two specific Spanish taxes that have a big impact on the net return of your move.
1. The Spanish Wealth tax (Impuesto sobre el Patrimonio)
Unlike Belgium, Spain has a wealth tax on global net assets. Although there are regional differences (Madrid, for example, has high exemptions, while regions such as Valencia and Catalonia are stricter), for wealthy individuals this can add up to an annual tax of 0.2% to 3.5% of power.
- Exemptions: Exemptions apply (often around €700,000 per person plus €300,000 for the owner-occupied home), often limiting the impact for the middle class.
- Solidarity tax: Recently, a national 'solidarity tax' was introduced for net assets above €3 million to counter regional tax havens.
2. The Spanish Capital gains tax (Ganancia Patrimonial)
This is the biggest pitfall for emigrants. If you sell your Belgian home, share portfolio or company after you have become a tax resident in Spain, you will pay in Spain capital gains tax on profits.
- The danger: You sell your house in Belgium with €200,000 capital gain. In Belgium, this is often untaxed. However, as a Spanish resident, you pay between 19% and 28% load in Spain.
- The solution: Timing is crucial. Making a sale for the move is fiscally essential.
Teleworking from Spain: tax rules and the Beckham Rule
Telecommuting from your second residence sounds appealing, but quickly creates a permanent establishment for your employer or company in Spain. This means that part of the income must be taxed in Spain in accordance with Spanish law.
Read more about emigrating to Spain and the implications on your taxes.
The Beckham Rule: A fiscal opportunity
For expats and digital nomads moving to Spain for work, the Beckham Rule. (Régimen especial para trabajadores desplazados) a way out.
- What is it? A special regime whereby you are taxed during the year of relocation and the following five years if non-resident.
- The advantage: You pay a flat rate of 24% on your income earned in Spain (up to €600,000), and you need to no load payable on income or assets outside Spain (excluding wealth tax on property in Spain).
- Condition: You must not have been a resident in Spain for the past five years and the move must be linked to an employment contract or mandate.
Social security and inheritance law: avoid surprises
In addition to taxation, your social status also changes dramatically. Spanish social security (Seguridad Social) differs fundamentally from the Belgian system, particularly in terms of health care and benefits.
- Health insurance: As a resident, you rely on the Spanish public system (without planning) or private insurance.
- Inheritance law: Spain has complex regional differences in inheritance tax. Without a Spanish will or clear estate planning, settling an estate can take years and be tax disadvantageous.
Read more about health insurance in Spain.
Frequently asked questions (FAQ)
1. Do I pay tax in Spain if I telecommute from my holiday home? If you are in Spain for less than 183 days, you generally remain taxable in your home country. However, once you exceed the 183-day limit, you become a Spanish tax resident and pay tax on your worldwide income in Spain. Please note that even for shorter stays, Spain can levy tax on wages physically earned in Spain.
2. What is the biggest tax risk when emigrating to Spain? The biggest risk is the Spanish capital gains tax on the sale of Belgian or Dutch assets (such as your former family home or shares). If you sell these after you become an official resident in Spain, you will pay up to 28% tax on the capital gain, something that is often untaxed in Belgium.
3. Does Spanish wealth tax apply to everyone? No, there are high exemptions (typically €700,000 per person). However, wealthy individuals (net assets > €3 million) are subject to the national solidarity tax anyway, even in regions that have abolished wealth tax.
4. Can I apply for the Beckham Rule if I already live in Spain? The application must be submitted within the 6 months after arriving in Spain. If you have been living in Spain for longer or have been a resident for the past 5 years, you are no longer eligible for this favourable regime.
