What are the pros and cons of Spain's non-lucrative visa?
Spain's non-lucrative visa is one of the most popular residency options for non-EU citizens to be able to live in Spain, but there are plenty of factors to consider before deciding if it's right for you, from taxes, to perks, the money you need and how the NLV's requirements compare to other visas.
The non-lucrative visa or NVL as it is often referred to, is an authorisation that allows non-EU foreigners to live in Spain without working or carrying out professional activities, by demonstrating that they have sufficient financial means for themselves and, if applicable, their family.
In Spanish it’s called a 'visado de residencia no lucrativa' and is often referred to as a retirement visa, as this is the best option for retirees from non-EU countries who want to spend their golden years in Spain.
So what are the pros and cons of this visa compared to other visas you can obtain to be able to live in Spain?
Pros
- You can apply for a family or joint NLV
One of the main pros of this visa is that you can include your spouse and other family members on your visa application, meaning that they can live in Spain with you and won’t have to apply for a separate visa. Be aware though, that for every family member included in the application, you need to prove that you have an extra €6,948 per year.
- You can invest
Although the NVL doesn’t allow you to work, it does allow you to invest while you’re living in Spain. You can invest in stocks and funds to get extra income or you can invest in a property to use for rental purposes. But unlike the golden visa, you don’t need to spend a minimum of €500,000 on a house in Spain, or even more if it's an investment in bonds or shares.
- You get to enjoy free movement within the Schengen Zone
Even though your NLV visa will be granted for residency in Spain, holders can travel freely within the Schengen Area, without applying for other visas from other countries within the block. This means that if you want to travel within the continent while you’re living in Spain, it’s easy for you to do so.
- It’s the only valid option for some non-EU people to gain residency in Spain
Sometimes the NLV will be the only visa available to you if you want to live in Spain as someone from a non-EU country. Work visas are quite complicated to get (unless you want to work as an Au Pair or seasonal worker), as you will need to be highly skilled and will need to find a job that is on Spain's ‘Shortage Occupation’ list. Any potential employer will also have to prove that there are no other suitable candidates in the whole of the EU with that skillset.
Golden visas require you to have a spare €500,000 in order to purchase real estate in Spain, while entrepreneur visas require you to have to submit your business plan to the relevant authorities and go through several complicated steps to get it approved.
READ ALSO: What you need to know about Spain’s visa for entrepreneurs
- You can exchange it for another visa
The good news is that after one year of living in Spain on an NLV, it will be easier for you to apply for a different visa – one that will enable you to work. It will be possible for you to get a work permit or to become self-employed (autónomo) through a process called residence modification.
READ ALSO: Should I change my non-lucrative visa for another residency permit in Spain?
- It can pave the way to Spanish citizenship
There are a couple of ways you can gain Spanish citizenship to be able to stay in Spain indefinitely when starting out with the NLV.
You can do so by renewing your NLV for a further two years, providing you have an extra €55,584 to do so. Once these two years are up, you can apply to renew the two-year NVL again (once again proving you have sufficient funds).
After the end of this period, you will already have been in Spain for a total of five years, meaning that you can then apply for long-term or permanent residency, which is valid for ten years.
Spain’s permanent residency can also be renewed or instead you can apply for Spanish nationality after ten years in the country. You can also get long-term residency or citizenship by going through the residence modification process as described above - renewing your visas every two years until you are able to get the long-term permanent residency after five years.
Cons
- You need to have quite a bit of money
One of the main requirements for the NVL is that you need to be able to support yourself financially. Currently, for 2022 this means that you need to prove that you have €27,792 for the year. For every family member included in the application, you need an extra €6,948 per year. This is the equivalent to €2,895 per month coming from things such as investments, pensions, savings or other assets.
On top of this, you will also need to pay for private health care - typically a plan which doesn't require any co-payments.
READ ALSO:
- How much money do Britons need to move to Spain in 2022?
- How much money do Americans need for Spain's non-lucrative visa
- You have to renew it often, and show that you have even more money
The NVL is only valid for one year, but if you decide that you want to stay in Spain beyond that time and want to renew it, you’ll need to show that you have more money than the first time. You can renew the visa for a further two years, but this means that you will have to prove that you have €55,584 available to live on for the next two years, and €13,896 for every family member with you in Spain.
- It doesn’t allow you to get a job or be self-employed in Spain
As the name suggests – the NLV is for those who are not working in Spain, this means that it does not allow you to get a job in Spain or become self-employed and work for yourself. Because of this, it may be difficult for you to renew it and show you have even more money - particularly because you haven’t been working. However, as mentioned above, it is possible to modify your visa after one year in order to be able to exchange it for a working or self-employed residency permit.
- You have to pay taxes
Spain’s non-lucrative visa is a residency visa, so you have to spend more than 183 days in the country for it to remain valid. This means that you will officially be considered a tax resident here.
Therefore, you have to pay income tax on your worldwide income and you should check if there are double taxation agreements between your country and Spain.
Even though you won't be working, you may still be receiving money from investments, from property rentals, from pensions or dividends from companies, which may be taxed.
READ ALSO - Reader question: Can I be a non-resident for tax purposes with Spain’s non-lucrative visa?
- You can't spend as much time outside of Spain without NLV expiring
One of the good things, as mentioned above, is that the NLV allows you to have free movement within the Schengen Zone. However, if your plan is to use the visa to explore the EU as much as you possibly can and maybe spend a few months travelling while you’re here, then you need to be aware that you have to spend more than 183 days in Spain for your visa to remain valid, especially if you want to renew it after the first year.
It’s true that you could technically use this visa to spend more than 90 consecutive days, but fewer than 183 and therefore not be considered a tax resident, but this isn’t a scheme that will necessarily work out for you in the long run. If you want to spend more than 90 consecutive days in Spain without becoming a tax resident, Spain’s Golden Visa may be a better option for you.
- Little time to sort things out
If your visa application is successful, then you will only be given three months to enter Spain once it’s granted, during which time you'll have to apply for a non-EU foreigner's ID card, the TIE. This could prove complicated, especially if you have a lot of things to organise before you go, such as renting out or selling your property, organising somewhere to stay when you arrive and filling out any extra paperwork you might need. There are also often delays, especially when dealing with official processes in Spain, so the three months may not give you a lot of time.
GREY AREA: Can I work remotely on an NVL?
This is a question that many people ask and it's a big grey area. As the name of the visa implies, you cannot work while you’re in Spain on the NLV, either for a Spanish employer or a Spanish company, but the law doesn’t mention anything specifically about working for clients and companies abroad.
Lawyers have differing opinions on the matter - some say you can, while others that you can't, and as so often happens, sometimes it's up to interpretation.
Be aware though, that some consulates won't grant you your visa if they believe that you will be working remotely. The good news is that the Spanish government has announced plans for a new digital nomad visa, which will allow you to work remotely in Spain for up to a year.
READ ALSO: Pros and cons - What foreigners should be aware of before applying for Spain’s golden visa
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See Also
The non-lucrative visa or NVL as it is often referred to, is an authorisation that allows non-EU foreigners to live in Spain without working or carrying out professional activities, by demonstrating that they have sufficient financial means for themselves and, if applicable, their family.
In Spanish it’s called a 'visado de residencia no lucrativa' and is often referred to as a retirement visa, as this is the best option for retirees from non-EU countries who want to spend their golden years in Spain.
So what are the pros and cons of this visa compared to other visas you can obtain to be able to live in Spain?
Pros
- You can apply for a family or joint NLV
One of the main pros of this visa is that you can include your spouse and other family members on your visa application, meaning that they can live in Spain with you and won’t have to apply for a separate visa. Be aware though, that for every family member included in the application, you need to prove that you have an extra €6,948 per year.
- You can invest
Although the NVL doesn’t allow you to work, it does allow you to invest while you’re living in Spain. You can invest in stocks and funds to get extra income or you can invest in a property to use for rental purposes. But unlike the golden visa, you don’t need to spend a minimum of €500,000 on a house in Spain, or even more if it's an investment in bonds or shares.
- You get to enjoy free movement within the Schengen Zone
Even though your NLV visa will be granted for residency in Spain, holders can travel freely within the Schengen Area, without applying for other visas from other countries within the block. This means that if you want to travel within the continent while you’re living in Spain, it’s easy for you to do so.
- It’s the only valid option for some non-EU people to gain residency in Spain
Sometimes the NLV will be the only visa available to you if you want to live in Spain as someone from a non-EU country. Work visas are quite complicated to get (unless you want to work as an Au Pair or seasonal worker), as you will need to be highly skilled and will need to find a job that is on Spain's ‘Shortage Occupation’ list. Any potential employer will also have to prove that there are no other suitable candidates in the whole of the EU with that skillset.
Golden visas require you to have a spare €500,000 in order to purchase real estate in Spain, while entrepreneur visas require you to have to submit your business plan to the relevant authorities and go through several complicated steps to get it approved.
READ ALSO: What you need to know about Spain’s visa for entrepreneurs
- You can exchange it for another visa
The good news is that after one year of living in Spain on an NLV, it will be easier for you to apply for a different visa – one that will enable you to work. It will be possible for you to get a work permit or to become self-employed (autónomo) through a process called residence modification.
READ ALSO: Should I change my non-lucrative visa for another residency permit in Spain?
- It can pave the way to Spanish citizenship
There are a couple of ways you can gain Spanish citizenship to be able to stay in Spain indefinitely when starting out with the NLV.
You can do so by renewing your NLV for a further two years, providing you have an extra €55,584 to do so. Once these two years are up, you can apply to renew the two-year NVL again (once again proving you have sufficient funds).
After the end of this period, you will already have been in Spain for a total of five years, meaning that you can then apply for long-term or permanent residency, which is valid for ten years.
Spain’s permanent residency can also be renewed or instead you can apply for Spanish nationality after ten years in the country. You can also get long-term residency or citizenship by going through the residence modification process as described above - renewing your visas every two years until you are able to get the long-term permanent residency after five years.
Cons
- You need to have quite a bit of money
One of the main requirements for the NVL is that you need to be able to support yourself financially. Currently, for 2022 this means that you need to prove that you have €27,792 for the year. For every family member included in the application, you need an extra €6,948 per year. This is the equivalent to €2,895 per month coming from things such as investments, pensions, savings or other assets.
On top of this, you will also need to pay for private health care - typically a plan which doesn't require any co-payments.
READ ALSO:
- How much money do Britons need to move to Spain in 2022?
- How much money do Americans need for Spain's non-lucrative visa
- You have to renew it often, and show that you have even more money
The NVL is only valid for one year, but if you decide that you want to stay in Spain beyond that time and want to renew it, you’ll need to show that you have more money than the first time. You can renew the visa for a further two years, but this means that you will have to prove that you have €55,584 available to live on for the next two years, and €13,896 for every family member with you in Spain.
- It doesn’t allow you to get a job or be self-employed in Spain
As the name suggests – the NLV is for those who are not working in Spain, this means that it does not allow you to get a job in Spain or become self-employed and work for yourself. Because of this, it may be difficult for you to renew it and show you have even more money - particularly because you haven’t been working. However, as mentioned above, it is possible to modify your visa after one year in order to be able to exchange it for a working or self-employed residency permit.
- You have to pay taxes
Spain’s non-lucrative visa is a residency visa, so you have to spend more than 183 days in the country for it to remain valid. This means that you will officially be considered a tax resident here.
Therefore, you have to pay income tax on your worldwide income and you should check if there are double taxation agreements between your country and Spain.
Even though you won't be working, you may still be receiving money from investments, from property rentals, from pensions or dividends from companies, which may be taxed.
READ ALSO - Reader question: Can I be a non-resident for tax purposes with Spain’s non-lucrative visa?
- You can't spend as much time outside of Spain without NLV expiring
One of the good things, as mentioned above, is that the NLV allows you to have free movement within the Schengen Zone. However, if your plan is to use the visa to explore the EU as much as you possibly can and maybe spend a few months travelling while you’re here, then you need to be aware that you have to spend more than 183 days in Spain for your visa to remain valid, especially if you want to renew it after the first year.
It’s true that you could technically use this visa to spend more than 90 consecutive days, but fewer than 183 and therefore not be considered a tax resident, but this isn’t a scheme that will necessarily work out for you in the long run. If you want to spend more than 90 consecutive days in Spain without becoming a tax resident, Spain’s Golden Visa may be a better option for you.
- Little time to sort things out
If your visa application is successful, then you will only be given three months to enter Spain once it’s granted, during which time you'll have to apply for a non-EU foreigner's ID card, the TIE. This could prove complicated, especially if you have a lot of things to organise before you go, such as renting out or selling your property, organising somewhere to stay when you arrive and filling out any extra paperwork you might need. There are also often delays, especially when dealing with official processes in Spain, so the three months may not give you a lot of time.
GREY AREA: Can I work remotely on an NVL?
This is a question that many people ask and it's a big grey area. As the name of the visa implies, you cannot work while you’re in Spain on the NLV, either for a Spanish employer or a Spanish company, but the law doesn’t mention anything specifically about working for clients and companies abroad.
Lawyers have differing opinions on the matter - some say you can, while others that you can't, and as so often happens, sometimes it's up to interpretation.
Be aware though, that some consulates won't grant you your visa if they believe that you will be working remotely. The good news is that the Spanish government has announced plans for a new digital nomad visa, which will allow you to work remotely in Spain for up to a year.
READ ALSO: Pros and cons - What foreigners should be aware of before applying for Spain’s golden visa
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