If you want to obtain the digital nomad residency in Spain, you will have to pay certain taxes that we are going to explain in detail in the following sections.

We are going to answer a very important question that arises when we obtain the residency as a digital nomad, which can be summarised as follows: What do I have to pay every month when I obtain the residency as a digital nomad?

There is a minimum income that we must cover in order to obtain the residency and, in this way, obtain the renewal after three years. However, it is important to bear in mind that this income can come both from the salary of a job and from other complementary income that we have such as rents or profits from a company, or we can even combine both forms to cover this minimum income necessary for the residency.

This is very important because there are certain countries, such as Morocco since 1975 or Algeria since 1985, that have bilateral agreements with Spain to avoid a double taxation. This means that if you earn an income in your country of origin for which you pay taxes there, you do not have to pay taxes again for that same income in Spain.

Next, we are going to analyse the taxes and social insurances that we have to pay in Spain when we register as a worker and start earning income from our work here in Spain. These taxes and social insurances are an important requirement to obtain the digital nomad residency.

Let us bear in mind that we are going to deal with the most unfavourable aspects of this requirement, but we should not forget the totally feasible possibility of complementing our income from our work in Spain, which may not be very high, with other income from our country because we have rents there, shares in companies from which we obtain profits, etc.

Before analysing in detail what we have to pay concretely, we must take into account the social insurances and the reason why they are important. This reason is none other than to get medical coverage for oneself and for the whole family. With these social insurances we will have the right to medical assistance from the Spanish public health system, in addition to being covered by this social insurance in case of sick leave or when we are going to retire in the future, these are the reasons why social insurances are contracted and paid for.

Having said this, we must take into account a possibility that family members who have arrived with a person who has obtained the digital nomad residency. This possibility is summarised in that family members can work as employees or self-employed.

Also, by means of a modification of digital nomad residency, which can be obtained when we have been living in Spain for some time, we can modify the type of residency, as long as certain requirements are met for another type of residency, such as non-profit residency.

In other words, if we have a digital nomad residency and with the passing of time I wish to retire, I can apply for a non-profit residency and convert my digital nomad residency into a non-profit residency, which has two enormous advantages.

The advantages of applying for the modification to the non-profit residency are summarised in the fact that there is no need to request an appointment and there is no waiting time because it can be applied for on-line, in addition to the fact that the application will be more flexible as it will be applied for in Spain instead of applying from a consulate, and on the other hand we have another important advantage which is based on the fact that we can continue with our digital nomad residency if we have any setback when trying to obtain the non-profit residency.

Now we will proceed to explain and detail what we have to pay if I get a residency as a digital nomad. Our calculations are going to be based on the minimum interprofessional wage, that is, the minimum wage that any worker earns by law.

This minimum wage is currently 1080€ per month. The regulation says that we have to earn at least double the minimum wage for the first member of the family or if a single person comes, they would have to earn 2160€ per month but remember that this amount of money can be earned both with the salary of a job and through other income we receive from rents or benefits from companies, or even supplementing the salary with additional income we receive from such rents or business benefits.

So, for a single person it would be double the minimum wage, which is 2160€ per month, but if that person comes with an additional person, such as a partner or a child, that additional person will have to earn 75% of the minimum wage, that is, they will have to earn 810€ and the two people would add up to 2970€, which is 2160€ for the first person and 810€ for the additional person who comes with the first person.

Then, for each additional member who is neither the first nor the second person mentioned above, such as a child coming with a married couple, you will have to pay 25% of the minimum wage, i.e. around €270 for each additional member who is neither the first nor the second person mentioned above, which would add up to a total of €3,240 if there are three people or €3,510 if there are four people, and so on.

6.1) Example with only one person:

Regarding what we have to pay in taxes and social security, let’s use the example of the person who comes alone and who earns 2160€ per month, which in a whole year would be a total sum of 25920€, almost 26000€. After all, in this case this person would have to pay in taxes 372€, while in social security the first year we could be exempt from having to pay the social security contribution or at most we would have to pay 80€, depending on each region.

In fact, there are some regions in Spain, such as the autonomous community of Andalucia, where you would be exempt from paying social security for the first two years, while in other regions you would pay €80 in social security for the first year and in the second year, depending on certain circumstances, you would pay another €80 or €320 in social security for the second year.

6.2) Example for two people:

For the example of the two people coming to Spain, we said that the amount they had to earn was €2970 per month, which in a whole year would be €35640, therefore, on this total amount they would pay €524 in taxes.

With social security the same happens as in the first case, you would have to pay €80. Although this depends, as we have already explained, on each region in Spain, as it may be that the first year you are exempt from paying the social security contribution or even the first two years, as happens in Andalucia, but what is certain is that the third year you will have to pay €350 of social security.

6.3) Example for three people:

For the example for three people coming to Spain, such as a married couple with one child, we said that the income should be 3240€, which in a whole year adds up to a total of 38800€, of which we would have to pay 557€ in taxes, while in social security we would have to pay the same as in the previous cases, being able to be exempt or not the first year or even the second year, depending on each region in Spain, but with total certainty we will have to pay the third year 370€ in social security.

6.4) Example for four people:

For the example of four people, such as a married couple with two children or a person with three children, we said that the income should be 3510€ per month, which in a whole year adds up to a total of 42120€, on which we would have to pay 626€ in taxes, while the social security contribution would remain the same as in the previous cases, having the possibility of being exempt from paying social security the first year or the first two years depending on each region in Spain, but with total certainty we would have to pay 370€ in the third year.

We remind again something important, we are trying to explain the most common situations for the digital nomad residency, you should keep in mind that if you have a higher income than the minimum income required, logically you will have to pay higher taxes.

It is also worth remembering that if you supplement your salary from a job with income from rents or from a profitable company, you can afford to have a lower salary because you supplement it with other income to reach the minimum required amount.

We should also bear in mind, as we have been asked many times, that if after the third year of residency as a digital nomad we do not want to continue with our business activity or we want to change our residency, absolutely nothing happens, because after 5 years we obtain permanent residency directly, as long as we have not left the country for the required time.

Conclusion

In short, we hope that this information, despite being sometimes complex and difficult to understand, has helped you and in case you need advice on any issue related to this digital nomad residency or any other type of visa or residency, you can contact us and we will be happy to assist you.

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