Spain's Beckham Law (Ley Beckham) is one of the most attractive tax regimes in Europe for new residents — a flat 24% rate on Spanish-source income for up to six years. Can you combine it with a tax-free US LLC? The answer is nuanced.
WHAT THE BECKHAM LAW ACTUALLY OFFERS
The Beckham Law (officially the “Special Regime for Displaced Workers”) allows qualifying new residents of Spain to be taxed as non-residents for up to six years. This means a flat 24% rate on Spanish-source income up to €600,000, with income above that taxed at 47%. Crucially, foreign-source income is generally exempt from Spanish taxation under this regime.
WHERE THE US LLC FITS IN
If your US LLC earns income from clients outside Spain, and you genuinely perform the work from Spain without triggering a permanent establishment there, that income is foreign-source income — and under the Beckham Law, it is generally exempt from Spanish income tax.
The structure then works as follows: your LLC earns profits, pays no US federal income tax (assuming no ETBUS), and you pay no Spanish income tax on those profits under the Beckham Law. The total tax rate on your business income approaches zero.
THE CONDITIONS THAT MUST BE MET
No permanent establishment in Spain: Your LLC must not have a fixed place of business in Spain. If you have a Spanish office, employees in Spain, or regularly meet clients in Spain to close contracts, you may have created a permanent establishment — which would make your LLC's profits subject to Spanish corporate tax.
Foreign clients: The income must genuinely be from foreign sources. If your primary clients are Spanish companies or individuals, the income may be reclassified as Spanish-source income.
Beckham Law eligibility: You must apply for the Beckham Law within six months of registering as a Spanish tax resident. You cannot have been a Spanish tax resident in the previous five years.
THE RISKS
Spain's tax authority (Agencia Tributaria) has become increasingly sophisticated in identifying structures that use the Beckham Law to shelter income that is economically connected to Spain. If your business is primarily serving Spanish clients, or if you are performing work that creates value in Spain, the structure may be challenged.
This is a legitimate and legal structure when implemented correctly — but it requires careful planning and ongoing compliance. A consultation with a Spanish tax advisor who specializes in international structures is strongly recommended before moving forward.
Not legal or tax advice
This article is for educational purposes only. Tax and legal rules are highly fact-specific. Always consult a qualified US tax attorney or CPA before making decisions based on this information.
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