The Startups law is an effort to attract startups and digital nomads to Spain.
On July 6 this year, the Council of Ministers approved a preliminary draft Law on the Development of the Startup Ecosystem, and on July 21, it was considered at the first public hearing by the Ministry of Economy and Digital Transformation.
Ley de Startups has several goals:
1. stopping the “brain drain” from the country;
2. attracting foreign investment and talent;
3. promoting cooperation between small, medium and large enterprises, as well as start-ups, including in the field of innovation;
4. encouraging interaction between start-ups and entrepreneurs with universities and research centers.
What changes can happen if the Law comes into force?
Digital Nomad Visa or Digital Nomad Visa
The visa will allow non-resident foreigners to live and work in Spain for up to 12 months with the possibility of extending it for another 2 years, while maintaining the conditions under which the initial application was made.
Those who can prove the status of a remote worker with companies located outside of Spain or with Spanish companies can apply for it, provided that the percentage of total income does not exceed 20%. In addition, it can be highly qualified specialists (graduates and postgraduates of universities, vocational schools and business schools, or with relevant experience for at least 3 years).
Tax incentives
– Reduced corporate tax (Impuesto de sociedades) from 25% to 15% for start-up entrepreneurs. The reduced rate is planned to be applied in the first tax period of activity, in which the taxable base is positive, and in the next 3 years, while maintaining this status.
– Reduction of income tax for non-residents (IRNR) from 24% to 15% for non-EU members during the first 4 years of stay in Spain.
In addition, startups will be able to demand a deferral of corporate or income tax arrears in the first fiscal year in which the tax base is positive, and in the next without charging late fees.
Encouraging new investment
It involves an increase in the taxable base on income from 12 to 45 thousand euros per year from the ownership of shares in new or newly created companies from 60 to 100 thousand euros per year. Newly created start-ups include firms with activities from 3 to 5 years in general and up to 7 years in specific areas (for example biotechnology), as well as with a turnover of no more than 5 million euros per year.
While the Startup Law is pending. We will follow the news!