Spain’s Digital Nomad permit: What it really covers and where it falls short

Spain’s Digital Nomad permit allows certain foreign professionals to take up residence in the country while working remotely. However, the simplified explanations and “quick guides” doing the rounds online can give a misleading impression of what it actually offers. Not everyone who works remotely will qualify, and it is not suited to every relocation plan.

To decide whether it is the right route, you need to look closely at the work you will be doing from Spain, your contractual relationship and your social security position. It is equally important to anticipate the tax implications of the move, as well as the conditions you will need to keep meeting throughout the life of the permit and when it comes up for renewal.

What is the Digital Nomad permit and who is it for?

The visa or residence authorisation for international teleworking is aimed at non-EU nationals who carry out employed or professional work remotely using computer and telecommunications technology.

There are two categories:

• Employees working remotely for foreign companies with no place of business in Spain.
• Self-employed professionals, including those who work through their own company, providing services to foreign clients. They may also work for Spanish businesses, provided this does not exceed 20% of their total professional activity.

Not every client relationship will satisfy this requirement. Services must be provided to entities engaged in business activity, which rules out, for example, private individuals and international organisations.

Among other things, applicants must show an existing employment or professional relationship of at least three months; that the foreign company exists and has been trading for at least a year; a university qualification or equivalent professional experience; sufficient financial means; and appropriate social security cover.

The assessment does not end with the application. You also need to be confident that the required conditions can be maintained for as long as the permit is valid and evidenced again at renewal.

A permit to live and telework from Spain

This authorisation is designed for people who intend to make Spain their home and work remotely from here. The term “Digital Nomad” can be misleading: it is not a permit for keeping a residence on paper while habitually working from other countries. Since services must be provided entirely from Spain, any time spent abroad must be consistent with the nature and requirements of the permit.

Nor was it intended as a replacement for the former investor residence scheme which, in return for a substantial investment, granted residence without any minimum-stay requirement and allowed the holder to work in Spain. If your aim is to live in Spain without working, or to run a business based mainly in Spain, other routes are worth considering, such as non-lucrative residence, the entrepreneur authorisation, or residence and self-employment, depending on your circumstances.

Social Security: where to contribute and how to prove it

Social Security for workers posted or relocating abroad is one of the most sensitive aspects of the Digital Nomad permit. You cannot simply choose where to pay contributions: the applicable legislation has to be determined on the basis of your home country, any international coordination agreements and the circumstances in which you work from Spain.

There are two main options:

• Continuing to contribute in your home country’s system, where an applicable international agreement allows it. This requires a certificate of coverage issued by the competent authority in your home country.
• Contributing in Spain, where home-country cover cannot be maintained. For employees, the foreign company must register with the Spanish social security system and meet the corresponding contribution obligations. Self-employed professionals must register under the Spanish self-employed workers’ scheme.

Tax residence and the Beckham Law: what to consider before you move

Living and working in Spain has tax consequences that need to be planned for.

Immigration residence and tax residence are separate concepts: being granted the Digital Nomad permit does not, in itself, determine how the holder will be taxed in Spain. Even so, the two issues should be considered together, taking into account both the requirements of the permit and the general rules on tax residence.

Nor does the permit guarantee access to the special tax regime for inbound workers, commonly known as the Beckham Law. The specific international teleworking route applies to employees who become tax resident in Spain and meet the other requirements and deadlines. A self-employed professional cannot automatically opt into this regime simply by obtaining the international teleworking authorisation.

Renewing the Digital Nomad permit and compliance checks

In our experience, the detection of breaches is leading to more rigorous checks, particularly at renewal. A favourable decision does not mark the end of scrutiny: the requirements must be met throughout the life of the permit, and the authorities are entitled to verify them. Failure to comply may result in the authorisation being revoked.

Renewal is not automatic. You will need to demonstrate continuity of your work, sufficient financial resources and compliance with your social security and tax obligations. Keeping contracts, payslips or invoices, proof of income and certificates of coverage will make this process much smoother. Any change of employer, clients or social security arrangements should be assessed in advance, before it jeopardises the continuity of your permit.

Why specialist legal advice matters

Before applying for the Digital Nomad permit, it is wise to check not only whether you meet the requirements, but also whether you will be able to keep meeting them, and whether this authorisation genuinely fits your professional activity and your plans for living in Spain. Looking at your contractual relationship, social security cover and tax position together makes it possible to spot difficulties before you move and to consider whether another type of permit might suit you better.

At AGM Abogados, we can help you work out which permit is right for your situation and what it will mean for you and, where relevant, for your company. Contact with our Immigration and International Mobility team before you begin the process.

Because in international mobility, securing residence matters. But choosing the right residence from the outset matters even more.