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VISAS

What will Spain’s income requirement for the digital nomad visa be?

Spain's new digital nomad visa will have to compete with other countries' alluring residency offers for remote workers. What is Spain's minimum income requirement likely to be and how will it stack up against other nations' visas?

What will Spain's income requirement for the digital nomad visa be?
Digital nomads in a co-working space. Photo: MANDEL NGAN / AFP

Spain recently approved its Startups Law, which includes a one-year digital nomad visa (extendable up to five years) to allow remote workers to come and live and work in the country. It is expected to be available from early 2023.

In a nutshell, it will grant non-EU freelancers and remote workers entry and residency rights in Spain, with less bureaucratic obstacles than there currently are and enticing tax benefits.

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Many nomads have been waiting with bated breath to learn all about Spain’s digital nomad visa, which has been in the works for over a year and countless remote workers are ready to make the move.

But as of yet, all the details of the visa haven’t been released and we don’t know what the final requirements will be, including how much you’ll have to earn to be eligible.

Most digital nomad visas around the world require you to prove that you earn a minimum monthly and these amounts can range dramatically, so what will Spain’s requirement be?

What do other European countries require digital nomads to earn?

Croatia has been offering its digital nomad visa since January 2021 and requires its applicants to prove they have a monthly income of €2,361 per month.

Malta’s Nomad Residency Permit states its applicants must have a slightly higher amount of €2,700 gross per month, while Hungary’s White Card (its version of the digital nomad visa) requires a slightly lower amount at €2,000 per month.

Most seem to hover around the €2,000 mark However, there are several countries in Europe that require nomads to prove they have a monthly income of above €3,000.

Those wanting to move to Romania must prove an income of €3,300 per month, to Greece of €3,500 per month and Estonia of €3,504 per month.

These relatively high amounts for the last three countries may indeed prevent many digital nomads from moving to these nations, so if Spain wants to attract as many remote workers as possible as is its aim, it should keep in mind to set a reasonable amount.

Portugal, which is currently one of the top destinations for digital nomads in the world, recently announced their new digital nomad visa and requirements. The average monthly income for the last three months must be equivalent to at least four times the national minimum wage in Portugal, which is currently €705 per month. This means they will need to prove a monthly income of at least €2,820.  

How much money will you need to earn to obtain Spain’s digital nomad visa?

Spanish media have been speculating how high Spain will set the bar and all of them estimate that it is likely to be around €2,000 a month gross, around twice the country’s minimum wage.

It’s worth stressing that nobody within Spain’s government has yet suggested an amount, nor was a figure included in the draft law published following its approval by the Spanish Parliament.

It will be up to Spain’s Economic Affairs Ministry and crucially the Senate to decide what the minimum amount required is before the law comes into force in early 2023. 

The closest type of residency permit Spain has to the digital nomad visa is the non-lucrative visa, which allows you to live in Spain for a year. The main stipulation though is that you’re not allowed to work, so it has so far precluded digital nomads.

Up until now, many digital nomads have in fact come to Spain either on tourist visas or have been using the non-lucrative visa and hiding the fact that they’ve been working, as technically you’re not allowed to, even if it’s for companies outside of Spain.

READ MORE: What are the current rules on remote working and taxes in Spain?

One of the main requirements of the non-lucrative visa is that applicants must prove they have a passive income of €2,316 per month from investments, rental income, pensions or other passive income abroad.

This equals 400 percent of the IPREM and the Spanish government could certainly choose a similar amount for its nomad visa.

Another fact to keep in mind is that the financial requirements for Spain’s non-lucrative visa and the golden visa (residency through property or investment) are both considerably higher than Portugal’s requisites, so will Spanish authorities really be willing to lower the bar below Portugal’s mark when it comes to the digital nomad visa?

Digital nomad profile

According to the website Digital Nomad World, in 2022 the average digital nomad is 40 years old. However, those in their 30s make up 47 percent. A surprising 61 percent of all digital nomads started their journey in their 20s.

Male digital nomads are most likely to work in marketing, IT/development and digital design, while female nomads mostly have jobs in the creative or marketing industries such as digital design, writing and animation.

The majority of both male and female remote workers are self-employed, so their income is likely to fluctuate month to month, another factor the Spanish government should keep in mind when deciding on the financial requirements. 

The majority of them are married or travel with a partner, but do not have children.

Studies from the Digital Marketing Institute suggest that one in five digital nomads who come from the US make between $50,000 (€48,200 or €4,000 a month) and $99,000 a year (€95,450 or €7,950 a month). This is typically more than their European counterparts would earn and especially more than those working in creative industries such as writing.

It also means that four out of five US digital nomads earn less, and many may struggle to show monthly earnings that are above €3,000 if Spain sets the bar that high.

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For members

WORKING IN SPAIN

Should my employer cover my bills if I work from home in Spain?

With more people than ever working from home in Spain, one of the main doubts among contract employees, autónomos and remote workers is whether the companies they work for should cover their home internet, electricity and other work costs.

Should my employer cover my bills if I work from home in Spain?

The answer is a bit of a grey area and will depend on several factors, including the company you work for, whether you’re employed or self-employed or if you’re a remote worker for a company outside of Spain.

If you once worked in the office, but are now working from home all day using more electricity, heating or air-con than you would have before, it makes sense that your company should be contributing to these costs, but is this always the case?

Employed workers for companies based in Spain

The first step in answering this question is to look at what Spain’s Remote Work Law says on the matter – Article 12 of Spain’s Ley 10/2021, de 9 de julio states that “Remote work must be defrayed or compensated by the company, and it must not result in a worker covering expenses related to equipment, tools and other means related to their work activity”.

This seems to suggest that companies are responsible for paying bills related to work tasks, but according to Control Laboral, a website specialising in workers’ rights in Spain, in practice the law is ambiguous.

They say that it doesn’t include any actual figures and doesn’t specify what tools are needed to carry out the work, even though it does seem to suggest that the companies should be contributing to remote workers’ bills.  

In order for this law to hold up, the website suggests that an agreement must be drawn up by human resources, stating exactly what the company will cover and how much, and that it must be signed by both parties for it to be valid.

If you’re working for a company in Spain that doesn’t offer any help in this regard, it’s important to talk to them to see if this can change.

If you were hired as a remote worker and they’ve never offered any payment for bills, it may be in your contract that these aren’t covered, but if you’ve been working from home since the Covid-19 pandemic, a new contract may need to be drawn up and you will need to negotiate with your employer. 

READ ALSO- Readers reveal: ‘Remote working in Spain has been a bittersweet experience’

Self-employed in Spain

If you’re autónomo or freelance and work for multiple companies or even just one, are any of those expected to help pay your bills? Again, this will really depend on the company and what it says in your contract, but generally, if you’re working for multiple companies as a freelancer, they will not pay your bills.

It’s up to you to factor this into your overheads and invoice accordingly. What you can do though, is to offset some of the cost of your bills on your tax returns. Keep in mind it’s a very minimal amount. You will only be able to offset the percentage of the bill that equates to the area you work in – your home office for example and then only the percentage of time you actually work in that room. This means that on an average energy bill you will only be able to offset €3-4, depending on the size of your office and how much energy you use.

Another unfair factor is that energy bills can only in be in one person’s name, so if you and your partner both work from home and the bills are in your name, you are the only one who can deduct them on your tax returns. 

READ ALSO – Self-employed in Spain: What you should know about being ‘autónomo’

Remote worker for a company outside of Spain

If you’re working for a company outside of Spain but live here, then your company will not be covered by Spanish laws. You may have to look at what the laws say in the country the company is based in.

Again this will be something that you’ll have to negotiate with your employer and get added to your contract, if there’s no mention of the company covering any bills. 

It may be a little more difficult for you and your company to define which and how much of the bills they will cover.

For example, unless your company states that you must be living in Spain, they may be unwilling to cover extra electricity bills because of air-con costs. They may also not believe that you need to put your heating on in winter and may need any extra help in the colder months of the year.

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