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VISAS

INTERVIEW: ‘No lawyer can guarantee you get Spain’s digital nomad visa’

Applying for Spain’s new visa for non-EU remote workers and digital nomads is more troublesome than expected, especially for Americans. Here lawyers reveal the main reasons why a positive resolution isn't always guaranteed.

digital nomad visa problems spain
Spain-based lawyers have come across a number of problems relating to the DNV application. Photo: Alexander Grey/Unsplash

Spain had a real need for a digital nomad visa or DNV, particularly after the pandemic when the government saw that many people around the world were working remotely. They also had to keep up with other European countries that had already launched DNVs such as Estonia, Croatia and Portugal.

Up until now, there was no clear and legal way that remote or freelance workers from outside the EU could come and live in Spain, so the Spanish DNV was warmly welcomed. But since it has launched it seems that not everything is not how it initially seemed and it is not an easy visa to get hold of.

“The Spanish government has not done it as well,” Juan Carlos Lois from letsLaw firm told El Periódico de España.

The problem, he said, is that the government “has mistakenly believed that everything works the same as in Spain and have distinguished between remote workers who work for a company and the self-employed, or freelancers, who have several clients. But the reality is that the most common applicant is someone who owns their own company and is the sole shareholder. They are not an employee or self-employed, but want to come to Spain to continue managing their business”.  

To find out, more about this specific issue, The Local contacted Maryem Essadik, a lawyer at international firm Marfour based in Barcelona.

Essadik explains that the main issue facing these different types of digital nomads when applying for the DNV is the question of social security.

The requirements of the visa state that the applicant must provide a certificate of social security coverage from their country of origin.

“The Spanish authorities have to guarantee that the remote worker has social security coverage in case of accident or disability, and that is why a certificate of social security coverage is required,” explains Essadik.

“Depending on the applicant’s situation, they will register as an autónomo (self-employed) at the Spanish social security office if they’re self-employed or a contractor. In the case they are employees, they will need proof of social security coverage from their country of origin if their country has an agreement with Spain,” she states.

In case the country where they come from does not have a social security agreement with Spain, the company will need to register with the Spanish social security system and obtain a contribution code and start paying it for the employee in Spain and not in their country of origin.

READ ALSO: ‘It seems impossible’ – The problems Spain’s digital nomad visa applicants face

This, however, is an issue because most companies won’t agree to pay extra money just so one of their employees can work in Spain when it’s not necessary.

Spain has social security agreements with several non-EU countries including the US, the UK and Australia so in theory obtaining this social security coverage shouldn’t be a problem, but in reality, it’s proving to be very difficult.

“There are several countries with which Spain, despite having a social security agreement, is not issuing such a certificate and this is making it difficult for employed remote workers to meet all the requirements for their digital nomad visa. This is true for the US, home to the largest number of people interested in moving to Spain,” explains Essadik.

She adds that the US authorities, in addition to taking almost 90 days to process these applications, do not understand the reason for granting these social security certificates, given the existence of a pre-existing social security agreement between both countries for remote workers (for example, for someone transferred from the US office to a Spanish branch as part of a temporary service contract).  

The question of social security coverage is one of the big problems that Spain-bound digital nomads face. Photo: Windows / Unsplash
 

Essadik, who recently went on a training course at the UGE (the competent authority in the processing and resolution of DNVs) said that US authorities contacted Spain to ask for more information on the matter and said: “It is clear that the Spanish authorities are demanding a certificate based on a legal agreement that is not appropriate for this residence permit”.

This is not the case for all countries, however. Some that have agreements with Spain have indeed produced these social security certificates for applicants. Essadik has personally seen remote workers from the UK, Russia and Ecuador who have been granted their DNVs. However, she believes that the DNV process is discriminatory because it’s a lot harder for some people to apply than for others.

Because of this issue, Lois believes that “no lawyer can guarantee that you will be granted the visa. There are many factors that determine the resolution”.

If you’re a freelancer and work for yourself, however, the situation is a lot easier. Essadik explains that if you are self-employed a simple letter can be submitted, confirming that you will register as autónomo once you arrive in Spain and be in charge of paying the social security fees yourself.

Unfortunately, there are many other problems that lawyers have come across regarding Spain’s DNV application.

The first is that there is no exclusive website catered to the application, Lois tells El Periódico de España. “There is none. The platform in New Zealand is wonderful and tells you if you are eligible or not. Today, in Spain it would be reckless for a foreigner to request a permit on their own without a lawyer specialised in immigration issues to help,” he explains. One box filled out incorrectly will mean your application is denied.  

Essadik agrees and recommends that the process be done with a serious law firm with lawyers registered with the census of lawyers of the Spanish Bar. “The process is not limited only to the knowledge of the list of documents and how to submit the application, but the professional who advises you must have knowledge of all foreign laws and administration along with other branches because errors can be common. We also see errors on the part of the public administration. We are seeing more and more because of the pressure that the UGE has to resolve it in 20 days”, she adds. 

Essadik recommends budgeting between €1,500 to €3,000 for the whole process, including legal assistance.

Like many administrative issues in Spain, there is always a catch-22 situation and for the DNV it seems that it’s no different.  

“The administration doesn’t think about helping people. For example, for the nomad visa you must pay a fee of €76. But to pay it you need the NIE. And to get the NIE you need an appointment, which is not available and is sold on the black market,” Lois says.  

“In general, these are things that could be corrected and they are willing, but they could be more generous,” he concludes.

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AMERICANS IN SPAIN

Navigating Spain’s real estate market: A guide for American homebuyers

There are some key matters US nationals looking to buy a Spanish home should consider, from legal complexities, to tax, property inspections and the role of buyer's agents. This quick guide by an international lawyer in Spain has you covered.

Navigating Spain's real estate market: A guide for American homebuyers

Buying a residential property in Spain can be an exciting yet complex endeavour, especially for American buyers unfamiliar with the intricacies of the Spanish real estate system.

With varying regulations at the state, regional, and local levels, it is crucial to be well-informed and well-prepared.

In this article, Maryem Essadik, immigration lawyer and head of English-speaking international law firm Marfour, offers US nationals a breakdown of the key considerations when buying a Spanish property.

Legal Complexities

Spain’s legal framework for real estate transactions is multifaceted, involving regulations that differ significantly between the national, regional, and local levels. Therefore, engaging specialized real estate lawyers is highly advisable.

1. State, Regional, and Local Regulations: The Spanish legal system is characterized by its decentralized nature. Each autonomous community in Spain can have distinct laws affecting real estates and property transactions. For example, while some regions may establish restrictions for renting out properties (ie. Limitations or prohibitions on carrying out short-rental activities, limitations on long-term rental prices etc.), others might have significantly varying taxes and fees associated with property purchases, and others can also count with a singular regional Civil Code that regulates in a particular manner important aspects such as the initial down payment contract (“Arras” in Spanish) when buying a property. Municipal regulations can also considerably impact property use and renovations.

READ ALSO: Which cities in Spain have new restrictions on tourist rentals?

2. Legal Representation: A lawyer with expertise in Spanish real estate law can navigate these complexities, ensuring compliance with all applicable regulations. They can conduct due diligence, verify property titles, and check for any encumbrances or legal issues that could affect the purchase. Legal representation is not just a formality but a necessity in Spain to avoid potential pitfalls.

READ ALSO: What’s the difference between a gestor, a lawyer and a notary in Spain?

3. Immigration legal advice: In connection with the property you want to buy in Spain you should receive the proper immigration law advice. Nationality and Immigration regulations in Spain are a complex but at the same time exciting field to navigate to find the best solution that will be matching your concrete case and circumstances (i.e: Digital Nomad Visas, Non Lucrative visas etc.)

LISTED: The visa options Americans can apply for to live in Spain

Fiscal Considerations

Taxation is another critical area that requires careful attention. Spain’s tax system includes various taxes that can impact the overall cost and benefits of owning a property.

1. Tax Residency: Determining your tax residency status is essential as it influences the taxes you are liable to pay. If you spend more than 183 days in Spain in a calendar year, you are considered a tax resident. You can also qualify as tax resident in Spain if having in this country the centre of your economic interests. Tax residents are subject to Spanish income tax on their worldwide income, while non-residents are taxed only on income generated in Spain.

READ ALSO: Do I have to pay tax twice if I’m an American living in Spain?

2. Income Tax and Wealth Tax: Spain imposes income tax (IRPF) and wealth tax (Impuesto sobre el Patrimonio) differently across its autonomous communities. The rates and allowances can vary, so understanding the specific regulations in the region where you plan to buy is crucial. For instance, some regions might have higher exemptions for wealth tax, impacting the overall cost of owning high-value properties.

3. Rental Income: If you plan to rent out your property, you need to be aware of the taxation rules on rental income. US tax residents are currently taxed for their rental incomes in Spain at a 24 percent flat rate on rental income (not being allowed to deduct any expense), whereas Spanish tax residents include rental income in their general taxable income (with different expenses being tax deductible), which could be taxed at progressive rates. Counting with the appropriate assistance of tax lawyers specialized in American clients and with a full knowledge of the US-Spain Tax Treaty can considerably help you to improve your tax bill.

READ ALSO: What the new Spain-US social security deal means for Americans

4. Special Tax Expats Regime: Implemented at the time that David Beckham joined Real Madrid (and known because of that as “Beckham Regime”), that regime may allow you enjoying the pros of being a tax resident in Spain, by living in this country exceeding 183 days per year, but taking advantage of a 24% flat rate and only making taxable in Spain labour incomes together with other incomes generated in Spain but not being taxable in Spain those sourced abroad. This tax regime has a maximum total 6 years duration and those who are eligible for it they also avoid filing Wealth Tax in Spain for their worldwide wealth.

To properly apply for it, it is always recommendable carrying out a previous tax planning and analysis with specialized Tax Lawyers before buying your property and moving to Spain.

READ MORE: 

Property Inspections

A thorough technical inspection by a qualified architect is advisable to ensure the property meets all regulatory standards and is free from structural defects.

1. Construction Defects: Architects can identify potential issues such as structural integrity, water damage, and compliance with building codes. This is especially important for older properties or those that have undergone renovations.

2. Urban Planning Compliance: The inspection should also verify that the property complies with local urban planning regulations. Non-compliance can result in significant fines or even demolition orders.

READ ALSO: Do I need planning permission in Spain and how do I apply for it?

Buyer’s Agents

Unlike real estate agents who typically represent the seller and defend his interests, buyer’s agents work in the interest of the buyer, offering numerous advantages.

1. Local Market Knowledge: Buyer’s agents are well-versed in the local market conditions and can provide valuable insights into different neighbourhoods, school districts, community amenities etc. This knowledge helps in identifying properties that best match your preferences and needs.

2. Fair Pricing: Buyer’s agents can help negotiate better prices. They are familiar with the local market rates and can prevent the common practice of overpricing properties for foreign buyers.

3. Due Diligence: By conducting thorough market analyses and property evaluations, buyer’s agents can ensure that you make an informed decision. They also handle the negotiation process, striving to secure the best possible deal on your behalf.

READ ALSO:

Financial Advice

Securing favourable financial terms can result in substantial savings, making it essential to seek expert financial advice.

1. Currency Exchange: For American buyers, currency exchange rates can significantly impact the cost of purchasing a property. Working with a reputable currency exchange provider can help you get the best rates, reducing overall expenses.

2. Mortgage Conditions: Comparing mortgage conditions from different lenders is crucial. Spanish banks offer various mortgage products, and an independent financial advisor can help you find the most favourable terms, considering interest rates, repayment periods, and other conditions.

READ ALSO: What non-residents should now about getting a mortgage in Spain

Conclusion

Buying a residential property in Spain involves navigating a complex legal and fiscal landscape.

By engaging specialized lawyers, conducting thorough property inspections, utilizing the services of buyer’s agents, and counting with expert financial advice, American buyers can mitigate risks and make informed decisions.

With careful planning and the right support, purchasing a home in Spain can be a rewarding investment and a gateway to enjoying the country’s rich culture and beautiful landscapes.

This article was written by Maryem Essadik, immigration lawyer and head of English-speaking international law firm in Madrid Marfour (Contact: +34 698 917 840, [email protected]).

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