Foreign company owners & permanent establishment

Many self-employed professionals moving to Spain already own a foreign company — a UK Ltd, a Dutch BV, a UAE company, a US LLC. It is common among consultants, tech founders, e-commerce operators and digital entrepreneurs. The question is not only whether you can apply for the Beckham Regime, but whether your existing company creates Spanish tax risk once you are living and working here. Get this wrong and a clean personal tax position can be undermined by a messy corporate one. The same facts matter on the non-lucrative side too: if you want to rely on company distributions as passive means, our note on business owner income and the non-lucrative visa explains why stepping back from management is part of the visa file, not just the tax file.

"Owning a UK Ltd, a Dutch BV or a US LLC does not block the regime — but running it from your desk in Spain can drag the company into Spanish tax through a permanent establishment. Review where the company is really managed before you relocate."

Two separate exposures: the company and you

Ownership of a foreign company does not, by itself, prevent a Beckham application. But two distinct risks arise once you are in Spain: the company could become tax resident in Spain (via effective management), or it could be found to have a permanent establishment in Spain (via how it operates here). Either can create Spanish corporate tax obligations that sit alongside — and can complicate — your personal Beckham position.

Effective management: where decisions are made

If a foreign company is effectively managed from Spain — that is, if its key management and commercial decisions are taken from Spanish soil — Spain may argue that the company's place of effective management, and therefore its tax residence, is in Spain, regardless of where it was incorporated. For a solo founder who moves to Spain and keeps running everything personally from a Málaga desk, this is a real and often overlooked risk.

Permanent establishment: a fixed place or agent

Separately, if the foreign company carries out activity through a fixed place of business in Spain, or through a dependent agent who habitually concludes contracts there, Spain may argue the company has a permanent establishment — a taxable presence — even if the company remains resident elsewhere. The profits attributable to that Spanish presence can then be taxable in Spain.

How income is characterised matters

This connects directly to your personal Beckham position. If you perform the same services from Spain through a foreign company with no substance abroad, the Spanish Tax Agency may question effective management, permanent establishment, or whether the income should be attributed to you personally rather than the company. As we explain in the guide on the 24% rate, income that comes directly from your qualifying activity sits in a stronger position than income routed through a foreign company that lacks real substance abroad.

The cleanest Beckham files tell one coherent story: where you live, where the company is really run, where the value is created, and how the income flows all point the same way.

What we review before you relocate

• Effective place of management — where directors decide, where contracts are negotiated.
• Substance abroad — staff, premises, operational resources outside Spain.
• Permanent establishment risk — fixed place or dependent agent in Spain.
• Related-party services and transfer pricing between you and the company.
• Where income should arise — personally as an autónomo or through the company.

For US founders there is an extra layer: the US–Spain treaty, the treatment of an LLC (which the US and Spain may classify differently), and reporting obligations. The point is not that a foreign company blocks the move — it is that the structure must be reviewed and, where needed, adjusted before you relocate, not after facts are created.

Effective management in depth: board, minutes, signatures

Under general Spanish corporate-residence principles, a company can be treated as tax resident in Spain if its place of effective management is located here — in broad terms, the place where the key management and commercial decisions that are necessary for running the business are actually taken. This is a facts-and-circumstances test, not a box on a form. The certificate of incorporation tells you where the company was created; it says very little about where it is genuinely run. When a founder relocates to Spain but continues to be the person who decides everything, the practical centre of decision-making moves with them.

What does the Spanish Tax Agency look at when it tries to locate the real centre of management? In practice, several ordinary business facts matter:

• Where the directors physically are when they decide. If the sole director or the effective decision-maker sits in Málaga, decisions taken from that desk are taken in Spain, whatever the notepaper says.
• Where board meetings are held. Not where they are minuted as held, but where the participants actually are. Video calls do not relocate a decision to a foreign boardroom simply because the software server is abroad.
• Where the minutes are prepared and the resolutions originate. Minutes that are drafted, in substance, from Spain and merely signed elsewhere are weak evidence of foreign management.
• Who negotiates and signs contracts. If the person who negotiates terms, agrees prices and signs the company's contracts does so from Spain, that points to Spanish management and, as discussed below, can also feed a permanent-establishment argument.
• Where day-to-day operational instructions come from. Emails to suppliers, approvals of invoices, hiring decisions and banking authorisations all leave a trail that shows where control actually sits.

Good governance abroad has to be real, not cosmetic. Appointing a nominee director who does not actually decide anything, or holding a formal board meeting once a year in the country of incorporation while every real decision is taken from Spain during the other 364 days, tends to fail on substance. If the intention is that the company is genuinely managed outside Spain, the people who take the meaningful decisions need to be outside Spain when they take them, with documentation that reflects the reality rather than dressing it up.

This is especially important for acquisition entrepreneurs and search funds. A searcher who moves to Spain while sourcing, financing, buying and operating a foreign target should also read the dedicated guide to search fund entrepreneurs under the Beckham Regime, because HoldCo, OpCo, lender approvals and board decisions can create company-side facts separate from the person's personal tax election.

The two permanent-establishment tests, with examples

Permanent establishment (PE) is a separate question from corporate residence. A company can be resident abroad and still have a taxable presence — a permanent establishment — in Spain in respect of the profits attributable to activity carried on here. Spanish law and the tax treaties Spain has signed generally recognise two classic routes to a PE: the fixed place of business and the dependent agent.

The fixed place of business test. A PE can exist where the company has a fixed place — such as an office, a workshop, a branch or premises — through which its business is wholly or partly carried on. The place must have a degree of permanence and be at the company's disposal. Two illustrative situations:

• A UK Ltd consulting business rents a small office in Valencia and its founder works there full time serving clients. That office may amount to a fixed place of business through which the company operates in Spain.
• A founder works from a dedicated home study in Spain that is, in practice, the operating base of the company — the address on the contracts, where the equipment sits and where the work is done. Depending on the facts, a home office used this way can raise a fixed-place argument.

The dependent agent test. A PE can also arise where a person acting on the company's behalf in Spain habitually concludes contracts in the company's name, or habitually plays the principal role leading to the routine conclusion of those contracts without material change by the company. The classic example: the founder, living in Spain, is the one who habitually negotiates and closes the company's sales with customers. Even if the paperwork is signed abroad, if the substantive negotiating and deal-making happens in Spain, a dependent-agent PE can be argued.

There are recognised carve-outs — activities of a purely preparatory or auxiliary character, and genuinely independent agents acting in the ordinary course of their own business, are generally treated differently. But a founder running their own company is rarely an "independent agent," and core revenue-generating activity is rarely "auxiliary." The result attributed to a Spanish PE — broadly, the profit that the presence would have earned as if it were a separate enterprise — can then be taxable in Spain under corporate rules, entirely separately from your personal Beckham position.

Related-party services and transfer pricing

When you own and also work for your foreign company from Spain, you and the company are related parties. Spanish transfer-pricing rules generally require that transactions between related parties be priced at arm's length — that is, on terms comparable to those that would apply between independent parties. This matters in both directions.

• What the company pays you. If you provide services to your own company from Spain, the remuneration should reflect the real value of the functions you perform, the assets you use and the risks you assume in Spain. Paying yourself very little while the company accumulates the profit abroad — when the value is actually created by your work in Spain — is exactly the kind of mismatch that attracts scrutiny.
• What you charge the company. Equally, management or service fees you charge the company have to be supportable, documented and consistent with what is actually done.
• Documentation. Related-party transactions may need to be reported and, above certain thresholds, documented. The absence of any documentation is itself a weakness if the arrangement is ever questioned.

Transfer pricing and effective management interact. If most of the value-creating functions have moved to Spain with you, both the transfer-pricing analysis and the effective-management analysis tend to point in the same direction — towards Spain. Planning the two together, rather than in isolation, avoids building a structure that solves one problem while creating another.

How a US LLC can be classified differently

US founders face an extra layer because a US LLC can be viewed differently on each side of the Atlantic. In the United States a single-member LLC is commonly treated as a disregarded entity, and a multi-member LLC as a partnership, so the LLC's income is generally taxed in the hands of its owners rather than at the entity level. Spain does not necessarily mirror that treatment and may look at the LLC through its own lens, which can lead to a mismatch about who is taxed, on what and when.

That divergence can produce practical problems: income the US treats as flowing straight to you personally, Spain might view through the entity, or vice versa; timing differences can arise; and treaty relief has to be mapped carefully so the same income is not taxed twice without credit. The US–Spain treaty and the interaction with US filing and reporting obligations mean this is an area where a US tax adviser and a Spanish adviser genuinely need to speak to each other. The key point for planning is simply that "it's just an LLC, it's transparent" is a US statement that does not automatically hold in Spain.

Restructuring options to consider before relocating

None of this means a foreign company blocks the move. It means the structure should be reviewed and, where useful, adjusted before you create Spanish facts. Broadly, the options fall into three families, and the right combination depends on the specifics:

• Add genuine substance abroad. If the company is meant to be run outside Spain, it needs real resources there — decision-makers, staff, premises or operations that actually carry on the business. Substance that exists only on paper does not solve an effective-management problem.
• Change where decisions are made. If keeping the company non-resident matters, the meaningful decisions have to be taken outside Spain by people who are genuinely there — with governance, board practice and documentation that reflect that reality.
• Change how income flows. In some cases the cleaner answer is to recognise that the value is now created by you in Spain and to let the income arise where the work is done — for example, personally as an autónomo under the Beckham Regime — rather than forcing it through a company that no longer has real substance abroad.

These are not mutually exclusive, and the best route often blends them. What they have in common is timing: they are far easier to implement before you relocate than to unwind after facts have been created and returns have been filed.

The expensive mistakes are almost always the ones made by relocating first and asking questions later.

A substance checklist

As a starting point for a structure review — not as a substitute for advice — these are the practical questions worth working through before you move:

Area	Questions to answer
Management	Who takes the key decisions, and where are they physically when they take them after the move?
Governance	Where are board meetings held and minuted, and does the paperwork match reality?
Contracts	Who negotiates and signs the company's contracts, and from where?
Premises	Does the company have or use a fixed place of business in Spain (including a de facto home office)?
People	Are there staff or operational resources abroad, or is the founder effectively the whole company?
Related-party pricing	Is remuneration between you and the company at arm's length and documented?
Reporting	Are related-party and foreign-asset reporting obligations identified and met?
US layer	For a US LLC, how do the US and Spain each classify it, and is treaty relief mapped?

Why the corporate story must match the personal one

The Beckham Regime is a personal regime, applied for under Article 93 of the Personal Income Tax Act (as amended by Law 28/2022) and evidenced through the Modelo 149 process set out in our Beckham master guide. It works best when the whole picture is coherent: where you live, where the company is really run, where the value is created and how the income flows should all point in the same direction.

Problems arise when the two stories contradict each other — when the personal application says the value comes from work performed in Spain, but the corporate arrangement pretends the company is run from abroad with no real substance there. Inconsistencies like that are precisely what invites questions about effective management, permanent establishment and income attribution. A file that tells one honest, joined-up story is both easier to defend and, in the ordinary course, the one that lets you use the regime the way it is intended.

General information, not legal or tax advice. Grounded in Article 93 of the Personal Income Tax Act (as amended by Law 28/2022) and general Spanish corporate-residence and permanent-establishment principles. Rules and treaties change and must be confirmed for your circumstances.