Exit Tax: Planning Your Departure from Spain Before Latent Gains Crystallise

Spain's exit tax (impuesto de salida, Art. 95 bis of Law 35/2006, LIRPF) taxes the unrealised capital gains on qualifying shareholdings when a Spanish tax resident changes their fiscal residence to another country. The exit tax applies to individuals who: (1) have been Spanish tax residents for at least 10 of the 15 tax periods immediately preceding the year of departure; and (2) hold shareholdings whose total market value exceeds €4M, OR hold ≥25% in a company whose total value exceeds €1M. The latent gain is taxed at the savings income rates under Art. 66 LIRPF (up to 28% from 2026). For moves to EU/EEA member states, Art. 95 bis.6 provides an automatic 10-year payment deferral without guarantees; for third-country moves, Art. 95 bis.5 provides a 5-year deferral conditioned on the provision of guarantees to the AEAT. The interaction with the Beckham Law impatriate regime (Art. 93 LIRPF) regarding the counting of Beckham-regime years towards the 10-year residency threshold is an area of ongoing interpretative uncertainty that requires case-specific analysis.

We advise on exit tax planning from the earliest possible stage — ideally years before the planned change of residence — to identify and implement the strategies that minimise the exposure while maintaining the commercial substance of the shareholding structures.

Why Spain’s Exit Tax Catches Long-Term Residents by Surprise

The most common surprise is the €4M threshold applied to the total market value of all qualifying shareholdings combined — not to the gain on any individual holding. An entrepreneur who has built a company from zero to a €4M+ valuation over ten years of Spanish tax residence will trigger the exit tax on the full latent gain in the year of departure, even if the shares have never been sold and no cash has been received.

The 10-of-last-15-years residency condition catches people who have been genuinely long-term Spain-based: founders who established their company in Spain, executives who relocated to Spain early in their careers, and international professionals who settled in Spain for a decade. The condition is not “permanent residence” — ten years out of the last fifteen is a lower bar than many people expect.

The Beckham regime interaction adds another layer of complexity for former impatriates. If the taxpayer spent years in Spain under Art. 93 LIRPF (Beckham Law), those years may or may not count towards the 10-year residency threshold for exit tax purposes, depending on the interpretation of the residency concept in each provision. We analyse this question individually for each client.

Our Advisory Process for Managing Spanish Exit Tax Exposure Before Departure

We engage as early as possible — ideally two to three years before the planned change of residence. The earlier the engagement, the more restructuring options are available. We begin with a full exposure analysis: all qualifying shareholdings (listed and unlisted), current market valuations, acquisition costs, latent gain computation, 10-year residency assessment (including Beckham years), and an estimated exit tax liability under current rates.

We then model the alternatives: EU/EEA deferral (10 years, automatic, no guarantees), third-country deferral (5 years, with guarantees), partial sale or donation strategies to reduce below the threshold, and timing strategies that take advantage of shareholding value fluctuations. For illiquid shareholdings in unlisted companies, the guarantee requirement for third-country deferrals is often the most complex element — we identify available guarantee structures and negotiate with the AEAT where necessary.

Annual compliance during the deferral period covers the required AEAT notifications, monitoring of shareholding changes that could trigger early payment, and — for EU/EEA deferrals approaching the 10-year limit — analysis of whether the deferred liability will be extinguished or must be paid.

Regulatory Framework: Art. 95 bis LIRPF — Thresholds, Deferral Rules, and the EU/EEA Automatic Deferral

Art. 95 bis.1 LIRPF defines the triggering conditions (10 of 15 years residency, €4M threshold or ≥25%/€1M). Art. 95 bis.3 establishes the computation method for the latent gain. Art. 95 bis.4 specifies the valuation rules for unlisted companies. Art. 95 bis.5 provides the third-country 5-year deferral with guarantees. Art. 95 bis.6 provides the EU/EEA 10-year automatic deferral without guarantees. Art. 95 bis.9 establishes the refund right where shares are subsequently sold below the exit tax valuation.

The CJEU and Spanish courts have addressed the compatibility of exit tax regimes with EU freedom of movement — the automatic EU/EEA deferral in Art. 95 bis.6 was introduced precisely to comply with EU law. Moves to non-EU countries are not protected by EU freedom of movement and the guarantee requirement is legally defensible under WTO and bilateral investment treaty frameworks.

Real Results in Exit Tax Planning and Deferral Management

• Quantified exit tax exposure for high-net-worth individuals and entrepreneurs before planned changes of residence, with modelling of all available strategies.
• Shareholding restructuring strategies that reduced qualifying shareholding values below the €4M threshold before departure, eliminating or substantially reducing the exit tax liability.
• EU/EEA deferral management with annual AEAT compliance throughout the 10-year period.
• Third-country deferral structures with bank guarantee arrangements for shareholders moving to the UK, US, UAE, and other non-EU jurisdictions.
• Beckham-regime interaction analysis for former impatriates assessing the correct counting of their years towards the 10-year residency threshold.