The Rise of Non-Resident Income Tax and the Beckham Law Controversy

The rise of Non-Resident Income Tax and the controversy over the Beckham Law: scrutiny, criticism and challenges for tax advisers

Introduction

Non-Resident Income Tax (IRNR) is at the centre of two tax developments. On the one hand, Tax Agency revenue has risen sharply, increasing by 38% in the first four months of 2025 alone. On the other, there is growing international controversy over the scrutiny of taxpayers using the special regime for inbound workers, commonly known as the “Beckham Law”.

1. Non-Resident Income Tax revenue in 2025: figures and contributing factors

In the first four months of 2025, IRNR revenue reached €1.674 billion, 38% more than in the same period of 2024.

For all of 2024, revenue had already exceeded €4 billion, an annual increase of 25.4%.

The Tax Agency attributes this rise to:

• Growth in capital income, particularly dividends paid to non-residents.
• A possible base effect following substantial refunds in 2023.
• Greater voluntary compliance after the announcement of tighter checks in the 2025 Tax Control Plan.

2. Scrutiny and monitoring of non-residents: a strategic focus for the Tax Agency

In its 2025 Tax and Customs Control Plan, the AEAT identifies the following as priorities:

• Checking undeclared rental income earned by non-residents.
• Monitoring capital gains from property sales.
• Correcting under-withholding on income earned by non-resident artists and athletes.
• Reviewing misuse of the Beckham regime, in cooperation with the Directorate-General for Taxation.

These actions are part of an effort to improve tax fairness, but they are also creating international tensions.

3. The dispute with Amsterdam & Partners LLP: criticism of the Tax Agency’s conduct

International law firm Amsterdam & Partners LLP has launched a media campaign criticising the AEAT’s handling of the Beckham Law regime. Its main allegations include:

• Discriminatory treatment of foreign taxpayers.
• Arbitrary inspections described as “abuses of power”.
• Failure to comply with the Agency’s own Code of Ethics.

The firm sent the AEAT a 13-question questionnaire seeking transparency about the proportion of taxpayers inspected, selection criteria, time limits, the effects of the 2023 regulatory changes, and the treatment of Form 720 and the Solidarity Tax in the context of the Beckham regime.

It has also created the “Spanish Tax Pickpockets” website as part of its international communications strategy, prompting coverage in media outlets such as the Financial Times and The Wall Street Journal.

4. Institutional response and critical analysis

The AEAT has defended its actions with the following figures:

• Only 0.5% of the 37,000 taxpayers using the special regime have been inspected.
• 70% of assessment reports are settled by agreement.
• Fraud has been detected, including sham employment contracts and shell companies used to obtain access to the regime.

Critical analysis:

• Although the official figures suggest that the scale of the problem may be limited, a lack of transparency and clear communication is causing reputational damage and distrust.
• The intense focus on wealthy foreign taxpayers may be perceived as tax-hostile.
• The narrow scope for interpreting the requirements to qualify for and remain in the Beckham regime leaves grey areas that the Tax Agency is pursuing through aggressive inspections.

5. International comparison and country risk

• Similar regimes in Italy, Portugal and France offer competitive incentives and more stable channels of institutional communication.
• Perceived legal uncertainty may affect Spain’s ability to attract foreign investment and bring talent back to the country.
• Country-level reputational risk grows when the dispute is litigated in European courts or becomes a media focus.

6. Recommendations for tax advisers

• Strengthen formal compliance when applying the Beckham regime.
• Document the inbound worker’s genuine employment links in detail.
• Prepare for information requests or inspections even where there is no prior risk history.
• Explain the current range of legal uncertainty to the client.
• Anticipate the possible effects of reforms arising from the “Madrid Memorandum”, which Amsterdam & Partners has announced as its next step.

Conclusion

The increase in Non-Resident Income Tax revenue is undeniable, but it cannot be assessed in isolation from institutional tensions and growing international scrutiny of how the Beckham regime is applied.

Spain’s tax system should aim to combine effective revenue collection with legal certainty and respect for sound administration. Transparency, consistency in interpretation and proportionate inspections are principles that must be protected if Spain is to establish a competitive and fair tax system.