Saturday, December 2

Spain has launched a digital nomad visa

Spain is a favored destination among remote workers due to its affordable living expenses and reliable internet connection.

After much anticipation, Spain has finally introduced its digital nomad visa.

This visa allows non-European Union (EU) nationals to reside and work in Spain for a maximum of five years.

The digital nomad visa was approved by the parliament in November 2022 as part of the Startup Act, which aims to attract entrepreneurship and strengthen the country’s tech industry.

Several other European countries, including Italy, Greece, Croatia, and Portugal, have already taken advantage of the growing trend of remote work by implementing their own digital nomad programs.

Spain had initially hinted at the introduction of this visa in January 2022, when Nadia Calviño, the Minister of Economic Affairs, expressed the country’s intention to “attract and retain international and national talents by facilitating the settlement of remote workers and digital nomads in Spain.” Authorities hope that this initiative will aid the country’s economic recovery from the impact of COVID-19. 

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Here's an overview of how Spain's new digital nomad visa simplifies and reduces the cost of living and working in the country.

Who is eligible to apply for Spain’s digital nomad visa? The digital nomad visa in Spain is available to non-EU nationals who work remotely for companies based outside of Spain. Applicants can receive a maximum of 20 percent of their income from Spanish companies.

Both self-employed freelancers with multiple clients and remote workers employed by a single non-Spanish company are eligible for this visa.

Applicants must be from outside the European Economic Area, not residing illegally in Spain at the time of application, and not have lived in Spain within the past five years.

They need to provide evidence of at least three months of work with their clients or employer before applying. The company they work for should have been operational for a minimum of one year, and applicants must demonstrate that their job can be performed remotely.

Applicants must also prove their qualifications or experience in their respective field. If they lack formal qualifications like a university degree or professional certificate, they can substitute it with a minimum of three years of work experience.

What are the requirements for Spain's digital nomad visa?

In addition to meeting the professional requirements mentioned above, applicants must demonstrate that they earn enough income to support themselves.

The income threshold is set at 200 percent of Spain’s monthly minimum wage, which can be verified through bank statements, contracts, and invoices. Currently, this amounts to €2,334 per month or €28,000 per year, but it may be subject to slight adjustments as the minimum wage is under review.

Applicants must have a clean criminal record in Spain and in the country where they resided during the five years prior to the application. They need to provide proof of a two-year clear criminal record and a sworn statement affirming their lack of criminal record within the last five years.

Proof of social security coverage from the applicant’s country of origin is also necessary. If the applicant’s country does not have a social security agreement with Spain, their employer needs to obtain a contribution code and begin paying the corresponding social security fees. This requirement has posed challenges for some applicants, as most companies are unlikely to agree to pay additional fees for remote work. Even in countries with social security agreements, such as the US and UK, obtaining the necessary certificate can be challenging.

Self-employed individuals face a somewhat simpler process. They only need to provide a letter stating their intention to register with the Spanish social security system upon arrival and take responsibility for paying the fees themselves.

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Applicants should be aware that obtaining certain documents, such as social security coverage proof, may take time. Additionally, the assistance of a lawyer might be required to navigate the application process, so potential fees should be factored into the budget.

How long can digital nomads stay in Spain? Initially, digital nomad visas in Spain are valid for 12 months or for the duration of the employment period if it is shorter than 12 months. Once in Spain, visa holders can apply for a three-year residency permit, which can be renewed for an additional two years, granting a total of up to five years in the country.

To maintain the visa, individuals must not be absent from Spain for more than six months per year.

Remote workers can also apply for a residency card that allows them to travel within the European Union while residing in Spain.

Close family members, such as children and spouses, can join the visa holder in Spain by providing proof of sufficient funds. For a family unit of two people, including the visa holder, an additional 75 percent of Spain’s monthly minimum wage (€875/month) is required. An extra 25 percent (€292) is added for each additional family member.

If included in the application, a spouse or civil partner is allowed to live and work in Spain as well.

How to apply for Spain's digital nomad visa

Applicants can directly apply for Spain’s digital nomad visa through a consulate or embassy in their home country. Alternatively, they can enter Spain on a tourist visa and apply within the first three months.

The required documentation includes the completed application form, proof of payment for the administrative fee, a copy of the passport, evidence of qualifications or work experience, proof of employment and income, proof of the company’s existence for at least one year, a letter of authorization from the employer to work in Spain, proof of a clear criminal record, and proof of social security coverage.

Applicants should be aware that many of these documents will need to be translated and certified by relevant authorities.

As the digital nomad visa is a relatively new initiative, response times from authorities may be lengthy.

Do digital nomads receive tax benefits in Spain? Individuals who stay in Spain for more than 183 days, even while working for a foreign company, are considered tax residents.

However, tax advantages are available for digital nomads who work and reside in Spain under the visa scheme.

Remote workers can benefit from a reduced tax rate of 15 percent during the first four years of their stay, as long as their annual income does not exceed €600,000. This reduced rate applies instead of the usual 24 percent.

Why is Spain appealing to digital nomads? Spain’s excellent internet speeds, affordable cost of living, and pleasant weather make it an attractive destination for remote workers.

Valencia, a coastal city in Spain, was recently ranked as the best city for expats worldwide, and Madrid also made it into the top 10. In addition, three Spanish villages topped the UNWTO’s annual ranking of the best villages for tourism globally, while UNESCO designated a Spanish street as the most beautiful in Europe.

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Article written by: Muhammad Salaahuddin

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