Living under the Spanish sun has its perks, but it also comes with responsibilities—like paying taxes. Whether you’re new to Spain or have been embracing the Mediterranean lifestyle for some time, it’s crucial to understand when your tax obligations begin. Your tax residency status hinges on factors such as your family circumstances, the location of your primary income and assets, and, most importantly, how long you’ve been in the country. So, when exactly are you required to start paying taxes in Spain? Let’s break it down.

When will I become a Spanish tax resident?

Under Spanish tax law, you are considered a tax resident in Spain if any of the following conditions are met:

1. You spend more than 183 days in Spain during a calendar year.

This is how the vast majority of people reading this will become a Spanish tax resident.

Note that 'temporary absences' (i.e. holidays) are included in the count, except where tax residency in another country can be proven.

For example, if you come to Spain in June but spend September on holiday in Morocco, intending to stay under the 183-day limit, the Spanish tax authorities might consider this Morocco trip as a temporary absence. However, if you are a Moroccan tax resident and can provide a certificate from Morocco proving this, you should be fine.

2. The main core or base of your economic interests is in Spain.

If your income or assets in Spain surpass those in any other country, Spain will be deemed the center of your economic activity. This presents challenges for footballers like Oriol Romeu. In a court case against him, the Spanish tax agency failed to prove he had spent more than 183 days in Spain during a calendar year. Instead, they sought to demonstrate that his primary economic interests were centered in Spain.

'The first step to link this reasoning consisted of analysing the money he had received from each team: €916,667 from Stuttgart, €742,065 from Valencia CF and €294,875 from Chelsea. These figures initially placed the core of his economic activity in Germany, but the inspectors warned that in Spain he had more than €1,000,000 in different accounts and two Audis whose value exceeded €50,000. In the United Kingdom and Germany, on the other hand, he kept just over €300,000.’

According to the Supreme Court, the fact that Romeu had the majority of his real estate and personal property in Spain indicated that he intended to maintain the centre of his economic interests in Spain. It was found to be "unquestionable" that the football player had his fiscal residence in Spain during the year in question, despite the fact that he had spent less than 183 days in the country. 

3. Your family (spouse and dependent children) have their habitual residence in Spain.

Offshore workers who are away for extended periods can be caught off guard by this. Even if they don't exceed 183 days in Spain, if their spouse resides there and their children attend a Spanish school, they are likely to be deemed Spanish tax residents.

The Importance of a Certificate of Tax Residency

If there’s ever a dispute over your tax residency during a specific period, Spanish tax authorities place significant weight on certificates of tax residency (unless they are from countries classified as tax havens). Providing evidence that you were a tax resident in another country during a given calendar year is a strong defence against being taxed as a Spanish resident. 

It’s important to understand that holding a tax certificate from one country does not automatically override the criteria for tax residency. An individual can be deemed a tax resident in multiple countries simultaneously. In such situations, double taxation agreements typically include a tie-breaker clause to resolve these conflicts. Also, note that in the case of Oriol Romeu mentioned earlier, the footballer possessed a UK tax residency certificate but still lost his case against the Spanish tax authorities.

Can I avoid being a Spanish tax resident while on the Digital Nomad Residency?

The primary goal of Spain's digital nomad visa and residency program is to boost tax and social security revenue. Avoiding Spanish tax residency is virtually impossible unless your stay is exceptionally brief.

As outlined below, during the first year it is possible to not be considered a Spanish tax resident. However, keep in mind that to renew the digital nomad residency, you must reside in Spain for more than six months each year.

The Golden Visa stands out as the only residency option that allows you to avoid becoming a Spanish tax resident—though it’s worth noting it may no longer be available by the time you read this.

Can I avoid being a Spanish tax resident for the 1^st year of the Digital Nomad Residency?

It is possible to avoid becoming a Spanish tax resident if you spend fewer than 183 days in Spain and take care to avoid the other two conditions outlined earlier.

However, if you spend more than 183 days in Spain within the year, you cannot avoid being classified as a Spanish tax resident.

Can I avoid being a Spanish tax resident for the 2^nd year of the DNV?

If you plan to stay in Spain for more than 183 days, the answer is no. You will be considered a Spanish tax resident for the entire calendar year. 

If your circumstances change and you decide to cancel your residency, be aware that most of the double taxation agreements specify that if over 6 months of work is carried out while physically in Spain, non-resident taxes will be due.