Displaced workers will be taxed in Spain on the vesting of stock options

The tax treatment of stock options for professionals moving to Spain under special regimes has raised doubts regarding the territoriality of the income. The Directorate General of Taxes (DGT) has specified how regulations should be applied when the vesting of these rights occurs after the relocation to Spanish territory.

What the DGT has resolved

The DGT determines that employment income derived from stock options corresponding to the period between the move to Spain and the vesting date is considered to have been obtained in Spanish territory. Consequently, this income must be taxed in accordance with the special regime established in the Personal Income Tax (IRPF) Law.

To calculate the taxable base, the proportional part corresponding to the period of activity carried out in Spain will be applied. However, the ruling marks an important distinction regarding the subsequent phase: the capital gain derived from the transfer of the shares will not be considered obtained in Spanish territory, as it does not meet the requirements demanded by the TRLIRNR.

What it means for you

If you are a displaced worker opting for the special regime of the Beckham Law, the vesting of your stock options is not exempt from taxation if the right vests while you are already residing in Spain. The criteria establish a clear division between two moments:

• Vesting: The income generated by the right to acquire the shares is taxed in Spain proportionally to the time worked here.
• Sale: The profit obtained from the price difference between the purchase and the sale of the shares will not be taxed in Spain under this regime.

What you should do

It is essential to maintain precise tracking of vesting dates and periods of activity in Spain to determine the proportional part of the income. Since the distinction between employment income and capital gains is key to the final tax burden, each situation must be analyzed individually to ensure the correct application of the regulations and to avoid contingencies with the Tax Administration.