Investment Strategy
1 minute read
Traditionally, Spain has been a sought-after destination for tourism; its beaches, its gastronomy, the historical cultural legacy, as well as the friendly nature of the Spanish people towards visitors, have made this country one of the main places for tourists worldwide.
However, Spain is much more than this. It is a country integrated into the European Union with the fifteenth largest economy in the world (based on GDP) and ranks twenty-first among the safest countries in the world.
The combination of all these elements has made Spain a very attractive country to reside in or, at least, to spend long periods of time visiting. If you are thinking about either of these two options (permanent residence or seasonal destination), it is important to carry out proper planning with a legal and tax team to make a global analysis of your situation and support you with the local implementation of the necessary aspects.
Before traveling, it is important to decide in advance what the length of your stay will be and whether it is necessary to obtain an immigration visa.1
It may be possible. Since 2013, Spain has had a regime of investment visas, which allows individuals who qualify to reside in Spain legally. To do this you must apply for a visa, commonly called a “Golden Visa”
It is important to be advised at all times by an immigration lawyer who can guide you properly. Mainly, the characteristics of the investor visa are the following:
The permissible investments in Spain include the following:
Investment group |
Investment type |
Amount |
Financial investments |
Public debt |
2,000,000.00 |
Actions |
1,000,000.00 |
|
Bank deposits |
||
Investment funds |
||
Estate |
Properties located in Spain |
500,000.00 |
Entrepreneurial business |
Of General Interest |
there is no minimum |
We have seen that obtaining a residence permit in Spain is relatively simple if the requirements for your application are met and that it does not require you to stay or reside in Spain.
If you are thinking of spending time in Spain or even if you are considering residing permanently, it is very important that you take into account certain tax aspects since if you are considered a tax resident, both your income and your world assets could be subject to tax obligations.
From a tax point of view, the tax residence in Spain can be attributed to a natural person for several reasons. Some aspects that contribute:
The circumstance may arise that, in accordance with the legislation of the taxpayer's country of origin, the taxpayer may be considered a tax resident in both countries. In these cases, it will be necessary to analyze whether Spain has signed a Treaty to avoid the so-called “double taxation” with the other country that intends to attract residence and see what tie-breaking criteria the Treaty has established.
In Spain, there is a tax regime that allows taxation, under strict compliance with certain requirements, only on income obtained in Spanish territory. This tax regime is the special tax regime applicable to workers, professionals, entrepreneurs and investors displaced in Spanish territory, commonly called the “Beckham Regime.”
This special regime may be requested by individuals who transfer their tax residence to Spain and meet the following requirements:
a) New employment relationship. Transfer to Spain ordered by the employer. The so-called “digital nomads” also fall into this category.
b) Company administrator. In this case, you can be a shareholder directly or indirectly of the company that is a shareholder without limit to your shareholding percentage unless the company of which you are an administrator does not carry out a business activity, in which case you can only hold up to a maximum of 25% of the share capital.
c) Carry out an economic activity classified as entrepreneurial activity (innovative nature with economic interest for Spain). In this case, it is necessary to obtain a favorable report from the National Innovation Company SME, SA.
d) Carry out activity by a highly qualified professional who provides services to emerging companies.
This regime is applicable in the year of arrival in Spain and the following 5 years, which allows tax stability for a reasonable period of time. The advantage that this special regime offers over the general regime for tax residents in Spain is that the taxpayer under this regime only pays Personal Income Tax (IRPF) on income originating in Spain. The Wealth Tax, likewise, applies only to assets located in Spain, and rights that can be exercised in Spain.
It is important to highlight that this special regime does not cover the Inheritance and Donation Tax, so any analysis carried out prior to a change of tax residence to Spain must consider the scenario of a possible inheritance or donation.
J.P. Morgan has a team of global wealth advisors who can help you review the optimal wealth planning for you and your family. We work with your independent attorneys and review what special considerations you should take into account to help you plan ahead for your and your family's future.
We can help you navigate a complex financial landscape. Reach out today to learn how.
Contact usLEARN MORE About Our Firm and Investment Professionals Through FINRA Brokercheck
To learn more about J.P. Morgan’s investment business, including our accounts, products and services, as well as our relationship with you, please review our J.P. Morgan Securities LLC Form CRS and Guide to Investment Services and Brokerage Products.
JPMorgan Chase Bank, N.A. and its affiliates (collectively "JPMCB") offer investment products, which may include bank-managed accounts and custody, as part of its trust and fiduciary services. Other investment products and services, such as brokerage and advisory accounts, are offered through J.P. Morgan Securities LLC ("JPMS"), a member of FINRA and SIPC. Insurance products are made available through Chase Insurance Agency, Inc. (CIA), a licensed insurance agency, doing business as Chase Insurance Agency Services, Inc. in Florida. JPMCB, JPMS and CIA are affiliated companies under the common control of JPMorgan Chase & Co. Products not available in all states.
Please read the Legal Disclaimer for key important J.P. Morgan Private Bank information in conjunction with these pages.
Bank deposit products, such as checking, savings and bank lending and related services are offered by JPMorgan Chase Bank, N.A. Member FDIC.
Not a commitment to lend. All extensions of credit are subject to credit approval.