Spain: Tax Exemption for Displaced Workers

Regarding our previous publication, in this one, we want to explain the exemption of article 7P of the Personal Income Tax Law (IRPF), which is a tax benefit applied to workers displaced abroad for work reasons. Basically, this exemption allows the income earned by these workers for their work outside their country of origin to be either not subject to taxes or subject to a more favourable tax treatment.

To apply for this exemption, it is important to meet certain requirements, such as being temporarily displaced from your habitual country of residence due to a work contract. Additionally, it may be required that the work be performed in a country where there is an agreement to avoid double taxation.

In summary, the exemption of Article 7P of the IRPF Law is a tool to avoid double taxation and provide a favourable tax treatment to workers displaced abroad for work reasons.