Expat: What It Means and How Taxation Works in Spain [2026]

Updated on:

October 21, 2026

TL;DR

Being an expat means living and working temporarily in another country, with tax obligations in both places. Find out about IRPF exemptions such as Article 7p, how to avoid double taxation and what documents you need to stay compliant with Hacienda (the Spanish tax authorities) hassle-free.

Being an expat comes with its fair share of challenges—especially when it comes to handling tax obligations both in your home country and your new one.

In this guide, we’ll break down what it really means to be an expat, how it differs from being an emigrant or an immigrant, and share key tips on how to work and manage your taxes while living abroad.

Let’s dive in!

Table of contents:

What does it mean to be an expat?

Being an expat means living and working in a country other than your own for a set period of time. It’s an exciting experience, often linked to international job opportunities.

Expats are often sent abroad by their companies to work in a branch or subsidiary in another country.

Unlike immigrants, whose goal is to settle permanently in a new country, expats usually keep their residence and ties to their home country, with the expectation of returning someday. While living abroad, expats face new challenges and find opportunities for personal and professional growth.

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Differences between expats, emigrants, and immigrants

It’s important to understand the differences between these terms:

Expat: An expat is someone who temporarily lives in a country other than their own, usually because they’ve been sent abroad by their employer to work at a branch or subsidiary.
For example, Juan is hired by a company in his home country to work at a foreign branch for two years. During this time, he remains a citizen of his home country and plans to return once his contract ends.
Emigrant: An emigrant is someone who leaves their home country to settle permanently in another. People emigrate in search of better job opportunities or living conditions.
For example, María decides to leave her home country to pursue better work opportunities. She moves permanently, obtains citizenship in her new country, and establishes her home and life there.
Immigrant: An immigrant is someone who moves to a new country with the intention of staying permanently. Immigrants seek a new life and may acquire citizenship or legal residency in their host country.
For example, Pedro flees his home country due to political conflict and seeks refuge abroad. He applies for asylum, eventually gains legal residency, and becomes a productive member of his new society.

Understanding these terms is essential, especially when it comes to knowing your rights and responsibilities—including tax obligations—in each situation.

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Working as an expat

Working as an expat means doing your job in a country different from your home country. It’s an exciting opportunity, but it also comes with challenges—like adjusting to a new work culture, facing language barriers, and building new professional relationships.

Here are a few things you can expect when working abroad:

A different work culture and language
New opportunities for professional growth
A valuable multicultural experience

All of this involves adapting to a new professional environment, which means you’ll need to stay on top of the administrative and legal procedures required in your host country. Doing things right from the start helps you avoid penalties or extra charges that could affect you financially.

At TaxDown, we’re here to guide you through the whole process—so you can file everything accurately, quickly, and stress-free. We’ve got your back!

What you need to know about taxes as an expat

One of the best tax perks is the Article 7p, which allows you to exempt up to €60,100 per year from taxes, a limit confirmed by the Spanish Tax Agency. It’s applied directly in your Spanish tax return.

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Frequently Asked Questions

Before you get more confused… Check this out—we might just clear things up in two lines.

Am I still considered a tax resident in Spain?

It depends on your time and situation:

– If you spend more than 183 days a year outside Spain and don’t have your main economic interests here, you’re no longer a tax resident in Spain. The Spanish Tax Agency sets the rule the other way around: you are a Spanish tax resident if you spend more than 183 days of the calendar year in Spain, or if the main centre of your economic interests is located here.
– But if you still maintain a home, your family, or return regularly, there’s a good chance you’ll still be considered a Spanish tax resident, even if you’re working abroad temporarily.

🧠 This is key, because your tax benefits change significantly depending on your residency status.

What documents should I keep if I work abroad?

– Assignment contract or relocation agreement with your employer.
– Residency certificates from the country where you work.
– Travel tickets, visas, and proof of stay.
– Detailed payslips and tax withholding certificates.

What if I’m no longer a tax resident in Spain?

In that case, you don’t need to file a Spanish tax return, unless you still have income from Spain (for example, rent from a flat in Madrid), in which case the Spanish Tax Agency requires you to declare that income under the Non-Resident Income Tax (Modelo 210). Just make sure you can prove that your tax residency has changed.

Frequently asked questions

What is an expat and how is an expat different from an emigrant or immigrant?

An expat lives and works temporarily in a country other than their own, usually sent by their company to a subsidiary or branch abroad. Unlike emigrants or immigrants, who aim to settle permanently in another country, an expat keeps their ties with their home country and usually expects to return at a specific, foreseeable time.

Am I still a tax resident in Spain if I work abroad?

It depends on how long you spend in Spain and where your centre of economic interests is. If you spend more than 183 days a year outside Spain and your economic interests aren't concentrated here, you're no longer a Spanish tax resident. However, if you keep a main home here, have your family here or come back regularly, you'll probably still be a tax resident even if you're working abroad temporarily. This classification is decisive in determining which tax benefits apply.

What is Article 7p and how can it help me save on tax?

Article 7p of the IRPF Law is one of the most important tax benefits for Spanish tax residents working abroad. It exempts the pay for work done physically abroad for a non-resident company or entity or a permanent establishment abroad, counted by the days spent abroad and capped at €60,100 a year. If that entity is related to your employer, for example a company in the same group, the work must give that entity an actual or potential advantage. The country where you work must apply a tax similar to IRPF and must not be a tax haven (a tax treaty with Spain that includes an exchange of information clause is enough to meet this requirement). If your employer withheld IRPF on that pay, applying the exemption in your tax return can get you back the withholdings that exceed the tax you owe.

Can I avoid paying tax twice on the same income?

Yes, through the deduction for international double taxation. The taxes paid in the country where the income is obtained are deducted in your Spanish return, up to the tax you would have to pay in Spain on that same income. If the foreign tax is higher than the Spanish tax, you don't get the difference back.

What can TaxDown do for you?

Personalized tax advice: Our tax experts, specialized in expat taxation, are ready to give you personalized guidance on your specific situation—and help clear up any doubts you might have!
Save you loads of money and time: We know how important it is to get everything right to avoid penalties and make sure you apply all the tax benefits you’re entitled to. That way, you can focus on what really matters in your life abroad.
Tax prep and filing made easy: Let’s be honest—doing taxes is a pain. With TaxDown, forget about those confusing forms and complicated processes. We take care of it all for you.
Security and confidentiality: Your tax data is private and deserves top-notch protection. That’s exactly what we offer—your privacy is our top priority. We simplify the complex world of international taxes so you can stay compliant without the stress.

No matter where you are in the world, TaxDown is here to help you.

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TaxDown Team

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TaxDown is the Spanish platform that helps you file your income tax return easily, quickly and with maximum savings. It's a social collaborator of the Agencia Tributaria (Spanish Tax Agency) and has more than 300 expert tax advisors who review every return.