The Spanish Parliament finally approved the eagerly awaited startups law or Ley de Startups on Thursday.
For the law to come into force, which is expected to happen in January 2023 once the Senate has processed its parliamentary implementation, it must first be approved by the Spanish Parliament, which happened yesterday.
Due to its excellent weather and renowned quality of life, Spain already draws a large number of visitors from all over the world. Until recently, however, it was illegal for many remote workers and digital nomads to work in Spain without the proper documents or a visa.
The new law is intended to reverse Spain’s status as one of the worst OECD nations in which to launch a business according to a study from 2015.
The startups law will provide workers access to a special visa that can be extended for up to five years and will be open to anybody from the EU or a third country as long as they haven’t lived in Spain in the preceding five years.
It will allow remote workers to pay non-resident tax and reduce corporate income tax for startups and investors from 25% to 15% for the first four years (IRNR). This applies to individuals and companies that earn their living in Spain but do not stay longer than 183 days.
The law also provides for a new visa that allows digital nomads to live and work in Spain for one year. After that period, they can apply for a residence permit for remote workers for another two years. After that, they can apply for another extension for a total of five years.
The specific restrictions and conditions that digital nomads must meet, such as the minimum wage they must earn or the possible certifications they must possess, have not yet been clarified.
According to some experts, the government will set a monthly cap of around €2,000.
It is also currently unclear whether digital nomads will have to pay social security contributions and be eligible for public health insurance, or whether they will have to take out private health insurance to meet the conditions for the visa.