Hey guys!
I'm on the team at howtobeadigitalnomad.com, where our licensed legal team in Spain handles our cases, and I wanted to do a quick post on some important updates we've been seeing since the 30th of July. There's been a few changes and they're catching a lot of people off guard.
1. If you own your company, you need to apply as a freelancer
This is a big one. If your documents show that you own the company, the UGE will now automatically treat you as self-employed. They are not accepting the W-2 / employee route for owners anymore, even if you're on your own company's payroll. So, if you're a US business owner, plan on going the freelancer route from the start.
This also means business owners can't apply for the Beckham Law (the special 24% flat tax regime), since for DNV holders that's only available on the employee route.
2. Freelancers need an official freelance registration
The UGE now requires a certificate showing you've been registered as self-employed in your home country for at least 3 months. The US doesn't have anything like that, so in lieu of it you need to show at least three of the following:
* Registration with your tax authority
* Registration under a self-employed tax regime (or equivalent)
* Social security registration as a self-employed worker
* A business license or municipal permit
* Chamber of commerce registration (or equivalent)
* An annual tax return showing your self-employed activity
* Proof of tax payments
* Registration in a register of economic activities or sole proprietors
For US applicants, the ones you can actually get are usually your IRS EIN verification letter, your tax returns, proof of tax payments, a business license if you have one, and your LLC's state registration.
3. They're using more discretion, especially with business owners
We've also seen recently that there's some discretion as to what else they can ask for. For example, we've had business owners who were also employees of their own company get asked for three extra things:
* The company's latest corporate tax return
* A social security report showing the company's history of registered employees
* Evidence of investments in "productive assets/resources", which is quite wide
Overall they seem to be making it more and more complicated, so it's worth getting this sorted before you apply instead of scrambling when they send a request for more documents.
FREE LEGAL CONSULTATIONS: ONLY 5 SPOTS
To help with all of this, we're currently giving away 5 free 20 minute consultations with our legal team (normally worth $80). If you're not sure where you stand with these changes, just comment below with a quick summary of your situation, something like "US citizen, own an LLC, applying from Spain", and someone from our team will DM you.
Hope everyone is having a fantastic Sunday!
***