The Spanish Directorate-General for Taxation (DGT), in its binding ruling V2095-24 of 26 September 2024, consolidates a doctrine of particular interest to the contributor with a philanthropic profile considering relocation to Spain: relocation to Spanish territory to take up the offices of trustee, chairman and general director of a Spanish foundation falls within the scope of article 93.1.b).2 of the Personal Income Tax Act (LIRPF) —“acquisition of administrator status of an entity”— thereby opening the special inbound regime to the founder-manager of the foundation. The ruling consolidates the doctrine laid down in V3283-17 of 22 December 2017 and adds two operative refinements: the causal link between the relocation and the appointment is also required in the foundation case —a factual question whose assessment falls to the inspection; and the concurrent holding of office in the Spanish foundation together with foreign board appointments, whether remunerated or not, is neither an obstacle to the regime nor a ground for exclusion.

It is helpful to begin with the legislative framework, because the inclusion of foundation offices within the concept of administrator under article 93.1.b).2 of the LIRPF requires the articulation of two regulatory blocks —the Personal Income Tax Act and the Foundations Act.

Article 93.1.b).2 of the LIRPF, in the wording given by Third Final Provision, paragraph five, of Law 28/2022 of 21 December on the promotion of the start-up ecosystem —with effect from 1 January 2023— establishes as the second triggering circumstance of the special regime the relocation “as a result of acquisition of administrator status of an entity”. The concept of “administrator” in the provision is not expressly limited to the corporate administrator of the consolidated text of the Capital Companies Act; the literal wording —“administrator of an entity”— admits a broad interpretation that encompasses any governing and representative body of a legal person with its own organisational autonomy.

Law 50/2002 of 26 December on Foundations articulates in its article 14 the Board of Trustees as “a governing and representative body of the foundation, which shall adopt its resolutions by majority on the terms established in the Articles”. Article 14.2 attributes the core function: “it falls to the Board of Trustees to fulfil the foundation’s purposes and diligently administer the assets and rights that comprise the foundation’s patrimony, maintaining their yield and utility”. The material function of the Board of Trustees is therefore identical in nature to the function of the administrative body of a capital company: governance, representation and administration. Article 15.4 sets out the gratuity rule —“trustees shall exercise their office gratuitously, without prejudice to the right to be reimbursed for duly evidenced expenses”— with the enabling exception: “the Board of Trustees may set an appropriate remuneration for those trustees who provide the foundation with services other than those involved in carrying out the functions corresponding to them as members of the Board of Trustees, with prior authorisation of the Protectorate”. This clause is what allows, in the case under review, the remuneration of the trustee who additionally takes up the office of General Director.

The case in V2095-24 reflects the profile of the senior Spanish entrepreneur with consolidated foreign ties who structures the relocation to Spain around an institutionalised philanthropic vocation. The requestor, a Spanish national and UK tax resident since 2014, is sole shareholder and member of the Board of Directors of a group whose parent company is established in Luxembourg, with wholly-owned subsidiaries in Spain, and majority shareholder of an investment company also seated in Luxembourg. He proposes to cease professional and economic activities in the United Kingdom, incorporate a foundation in Spain, and relocate his residence to Spanish territory to hold simultaneously the offices of trustee, chairman and general director of the foundation. The trustee and chairman offices would be gratuitous, in accordance with article 15.4 of Law 50/2002; the general director office would be remunerated —with prior authorisation of the Protectorate— for functions additional to those of the trustee office, with the proviso that such remuneration “shall not constitute a particularly relevant source of income in relation to the requestor’s overall economic situation”. He also states that he will retain his membership of the Board of Directors of the Luxembourg group of which he is sole shareholder, and that he may in the future join other boards —remunerated or not. He evidences non-residence in Spain for fiscal years 2019 to 2023 and the absence of future income that could qualify as obtained through a permanent establishment located in Spanish territory.

The question put to the DGT was set out in two points: whether relocation by virtue of the office of trustee, chairman and general director of the foundation allows election of the regime of article 93 of the LIRPF; and whether concurrent foreign offices —Luxembourg group board and possible future appointments— constitute an obstacle or ground for exclusion.

The DGT’s response is articulated on three pillars that warrant separate treatment, because each contributes an operative key.

First, the inclusion of the foundation office within the scope of article 93.1.b).2 of the LIRPF. The DGT refers to V3283-17, which examined an analogous profile —a requestor relocating to Spain to take up the office of trustee and general director of a Spanish foundation of general interest and national scope— and concluded: “the relocation by virtue of such office falls within the scope referred to in article 93.1.b).2 of the LIRPF (acquisition of administrator status of an entity), so that, provided the remaining requirements are met, the requestor may elect the special regime provided for in article 93 of the LIRPF”. V2095-24 ratifies this doctrine and consolidates it as established criterion: the office of trustee —and, a fortiori, the office of general director that takes on functions additional to those of trusteeship— is functionally equivalent to the administrator status of the provision. The Beckham regime therefore opens to the profile of the institutional philanthropist.

Second, the requirement of a causal link between relocation and appointment. The DGT formulates it with the same formula reiterated in rulings V1622-24 and V1209-25 —commented on previously in this journal in relation to the ordinary modality of the corporate administrator—: “the existence of a causal relationship between the relocation to Spain and the acquisition of administrator status is required. In the absence of that causal relationship between the relocation to Spain and the acquisition of administrator status of the entity, the requirement in article 93.1.b) of the LIRPF would not be met and, consequently, the person in question could not elect the special regime of article 93 of the LIRPF. In any event, the existence of such causal relationship is a factual question that must be evidenced by means of proof valid in law, the assessment of which does not fall to this Directorate but to the inspection and assessment bodies of the tax administration”. The causal requirement therefore operates as a material filter identical to that required in the corporate administrator case: the regime does not protect situations in which the foundation office pre-existed the relocation without functional connection to it, nor those in which the foundation was incorporated previously and the contributor joins the Board of Trustees disconnected from the decision to relocate to Spain. Planning must contemporaneously build the evidential file of the causal connection: minutes of the Board of Trustees, deed of incorporation of the foundation where contemporaneous with the relocation, operational plan of the foundation, decisions of the Protectorate, correspondence prior to the move.

Third, compatibility with concurrent foreign offices. The DGT confirms unequivocally: “the requestor may elect the special regime of article 93 of the LIRPF provided that the requirements of sub-paragraphs a), b) and c) of article 93.1 of the LIRPF are met, even where he retains membership of the Board of Directors of the group whose parent is established in Luxembourg, or, as proposed, acquires in the future administrator status of a commercial company”. The clause is relevant because it disposes of an interpretive risk not expressly addressed by the literal wording of article 93.1.b).2: that the coexistence of the Spanish foundation office with foreign offices might be construed as a ground for exclusion from the regime, particularly where income derived from the foreign offices exceeds that derived from the Spanish foundation. The DGT clears the point: concurrent foreign offices are neither an obstacle nor a ground for exclusion, provided that the income derived from them does not qualify as obtained through a permanent establishment located in Spanish territory —the filter of article 93.1.c)— and the remaining conditions of the regime are met.

The DGT adds, in a technical closing observation, the tax characterisation of the office’s remuneration: “the totality of the remuneration received for the exercise of the functions of such office must be understood, for personal income tax purposes, as included in employment income under sub-paragraph e) of paragraph 2 of article 17 of the LIRPF, which provides that in all cases the following shall be treated as employment income: ‘The remuneration of administrators and members of Boards of Directors, of Boards that act in their place and of other members of representative bodies’”. The characterisation under article 17.2.e) of the LIRPF is relevant in practical terms: the remuneration of the foundation’s General Director is taxed as employment income under the special regime of article 93 of the LIRPF, subject to the 24 % rate on the first EUR 600,000 and the 47 % rate above that figure, in accordance with the scale of article 93.2 of the LIRPF.

In our view, V2095-24 operatively opens the Beckham regime to a profile distinct from the traditional executive or the quasi-shareholder administrator of an operating company: the institutional philanthropist, founder and manager of a Spanish foundation. The broad interpretation of the concept “administrator” under article 93.1.b).2 of the LIRPF, anchored in the functional equivalence between the foundation’s Board of Trustees and the corporate administrative body, is legally sound and, above all, responds to the purpose of the regime following the reform under Law 28/2022: to attract qualified talent and human capital to Spain, subject to the evidential filter of causation. Compatibility with concurrent foreign offices disposes of an interpretive ambiguity that could in practice have blocked access to the regime for profiles with residual shareholding ties abroad —the typical scenario of the Spanish entrepreneur who has built a professional life abroad and structures the return around an institutional philanthropic vocation.

Subject to the above, the doctrine signals three operative caveats that warrant separate retention.

First, on the effective causation of the relocation. The DGT excludes the question from its ruling, which means that the binding ruling does not insulate the contributor from the factual assessment by the inspection. The evidential file must build the functional link between the incorporation of the foundation and the relocation: ideally, the foundation is incorporated contemporaneously with the relocation; the trustee office is taken up on the same date or with documentable temporal proximity; the operational plan reflects the requestor’s effective dedication to the foundation; the Board of Trustees minutes and Protectorate authorisations document the substantive reality of the foundation’s activity. A foundation pre-existing the relocation, with the requestor joining the Board of Trustees months or years after the move to Spain without operational justification, is exposed to negative recharacterisation.

Second, on the characterisation of the foundation for Protectorate purposes and the substantive regime of Law 49/2002. A Spanish foundation may elect the special tax regime for non-profit entities under Law 49/2002 provided that it meets the substantive requirements of article 3 —purposes of general interest, application of 70 % of income and revenue to the realisation of the purposes, gratuity of trustee offices, etc. Compatibility of the Beckham regime of the founder-trustee with the special tax regime of the foundation is full, but failure by the foundation to meet the substantive requirements —notably failure to apply income to the foundation’s purpose or improper distribution to related persons— may trigger loss of the foundation’s substantive regime and, in turn, expose the activity to recharacterisation as a commercial activity without foundational substance, with the consequent projection onto the founder’s Beckham regime. Planning must structure the foundation so that its material substance is not called into question.

Third, on the quantification of the remuneration as general director. V2095-24 highlights that the requestor’s remuneration for additional functions as general director “shall not constitute a particularly relevant source of income in relation to the requestor’s overall economic situation”. The wording is not casual: a remuneration disproportionate to the functional profile of the office, or disconnected from the economic substance of the foundation, could be recharacterised as a mere vehicle for tax domiciliation in Spain under the Beckham regime, without operational foundational substance. The Protectorate authorisation provided for in article 15.4 of Law 50/2002 operates, in this sense, as a material filter: the Protectorate must authorise the remuneration as “appropriate” to the distinct services rendered by the trustee, which requires functional justification and economic proportionality. Planning must document and size the remuneration consistently with the profile of the office.

The practical consequence is highly relevant for the contributor with a philanthropic profile considering the return to Spain.

It is advisable, in the first place, to articulate the relocation simultaneously with the incorporation of the foundation, with documentable contemporaneity of dates. The file must reflect that the decision to incorporate the foundation is taken in the context of the return to Spain, not as ex post justification of a relocation already effected.

It is advisable, in the second place, to endow the foundation with material operating substance: documented strategic plan, initial endowment proportionate to the purposes, annual operating plan approved by the Board of Trustees, material and human resources sufficient to evidence the foundation’s activity. The foundation must be real, not instrumental; the founder’s Beckham regime ultimately rests on the material substance of the entity whose administrator status motivated the relocation.

It is advisable, in the third place, to calibrate the articulation between the office in the Spanish foundation and the concurrent foreign offices so that income derived from the latter does not qualify as obtained through a permanent establishment located in Spanish territory. The line of the filter of article 93.1.c) of the LIRPF is narrow where the contributor maintains effective management activity abroad exercised partially from Spain: documentation of the place of adoption of business decisions, limitation of presence in foreign boards to in-person sessions in the State of the entity, and contractual articulation of non-executive director status —where applicable— are standard mitigation tools.

In conclusion, what this ruling of the Directorate-General for Taxation makes clear is that the Beckham regime opens operatively to the profile of the institutional Spanish philanthropist returning to Spain through the office of trustee and general director of a Spanish foundation. The doctrine, consolidated from V3283-17, rests on a broad interpretation of the concept “administrator” under article 93.1.b).2 of the LIRPF that encompasses the governing and representative bodies of non-corporate legal persons, particularly foundations under Law 50/2002. Compatibility of the office in the Spanish foundation with foreign administrator offices —remunerated or not— is full, provided that the substantive requirements of the regime are respected and no income qualifies as obtained through a permanent establishment in Spanish territory. The philanthropist’s planning must be articulated with a solid evidential file of causation, material operating substance of the foundation and proportional sizing of the general director’s remuneration.

Sources

  • Directorate-General for Taxation, binding ruling V2095-24 of 26 September 2024, Sub-Directorate-General for Personal Income Tax: petete.tributos.hacienda.gob.es.
  • Directorate-General for Taxation, binding ruling V3283-17 of 22 December 2017, direct antecedent expressly invoked by V2095-24: petete.tributos.hacienda.gob.es.