Dozens of British expats living in Spain say their “lives have been ruined” by a “punitive” tax on foreigners. Robert Amsterdam, a partner at Amsterdam & Associates LLP, says he has been contacted by at least 80 victims, many of them Brits, whose “lives have been ruined” by tax probes that are “inconsistent” with European law and human rights.
In an interview with The Telegraph, he added that “what Spain is doing to expats would embarrass a mafia don.” He claimed families have been hit by “unprompted and unexplained audits, attempted asset seizures of foreign property [and] onerous, expensive, and confusing compliance requirements”. To combat this, Mr Amsterdam’s law firm has launched the “Spanish Tax Pickpockets” campaign highlighting how foreigners who have moved to Spain for financial reasons are now vitctims of the “punitive tax claims”.
The country was once a magnet for affluent foreigners due to the so-called “Beckham Law” – named after David Beckham who played for Real Madrid from 2003 to 2007 – which allowed ex-pats to be taxed at 24% on the first €600,000 of their Spanish-sourced income for a maximum of six years.
Dividends, interest and capital gains earned outside Spain are generally exempt from tax under the scheme. Now, many of these expats are reportedly seeing their “Beckham law” tax status reassessed.
This has left those coming to Spain under the impression they would be protected by due process and a robust rule of law left instead “distressed and bitterly disappointed”, Mr Amsterdam said.
He added: “It’s a massive bait-and-switch. Victims are subjected to a draconian process which is an international outlier – often denied any explanation of why they are being audited and any right to challenge investigations until just before they conclude.
León Fernando del Canto, a tax lawyer and founder of Del Canto Chambers, told The Telegraph many expats are having their tax status reassessed after just a few years.
He said: “We are now seeing the tax office contesting the granting of the status after two or three years in the country. This has upset a lot of people and created insecurity, as they are no longer confident that only a certain amount of their income would be taxable.”
The tax authority is allowed to contest if it believes an individual’s tax status has changed, but the decision to Mr del Canto claimed the decisions to pursue cases has appeared “a little bit discretionary”.
The row is the latest flare-up to challenge Spain’s reputation as ideal destination for Britons in search of blue skies and a more relaxed way of life.
Britain’s love affair with Spain was dramatised in the Johnny Vegas sitcom Benidorm, which featured a host of characters who return to a resort each year. More than 17million UK tourists visited Spain in 2023 – more than from any other country, according to the Madrid-based tourism trade fair Fitur.
Spain also made headlines last month when Prime Minister Pedro Sánchez announced plans for a tax of up to 100% on properties bought by non-residents from outside the EU.
