Question
In relation to the recent changes and updates to the Spain Digital Nomad Visa applications, have the changes made it more favorable to apply as a W-2 employee of a US company?
Or is it still highly recommended to apply as an independent contractor or self-employed individual? While following the information shared in this group, I’ve read in a number of previous posts that applying for a DNV as a W-2 employee from the United States generally results in rejection and that only a select few have been approved.
I am trying to determine if I should leave my full-time job as a remote W-2 employee of a US company now, to start my own remote-based business serving as a consultant or 1099 contractor in my line of work (digital marketing for dental and orthodontic practices) so that I can apply for my DNV sometime in July or August of this year.
Or should I keep my job and apply as a W-2 employee? If I did start up my own business and had enough income to meet the monthly minimum, would 3 or more months’ worth of documentation or payment of client invoices, along with a BA degree in my field and over 15 years of experience in marketing, meet the requirements?
Answers
These are the answers of Spainguru’s Spain Digital Nomad Visa group members:
“Be aware if you incorporate a new business, it must be a year old before applying. It’s also become more complicated to apply as a contractor to a business you own recently, so I’d speak to a lawyer before going that route.
If your current employer would simply change you to a 1099 contractor and contract you directly (not through an LLC or other business entity you set up), that’s the easiest route. That’s what I did: my employer changed me from W-2 employee to 1099 contractor in mid-August, I arrived in Spain at the end of November, and applied through a professional representative.”
“If you are a contractor, they are no longer your employer, they are your client. So you pay your own social security. If they agree to register with Spanish Social Security, then you can stay a W-2 employee, but that’s a big ask. My company would not do it.”
“It’s still recommended to apply as a self-employed independent contractor, unless you can convince your company to register to pay Spanish Social Security. The CoC from the US, as far as we know, is still not being accepted apart from a few rare cases.”
“It is only 3 months if you personally contract directly with the employer. That’s called a sole proprietorship in the US and an autónomo in Spain. There’s no type of registration needed in the US, just sign a contract and start invoicing under your own name (there will be registration in Spain once you are approved for the visa). If you create an LLC, invoice through the LLC, and pay yourself through the LLC, then you need to wait a year.”
“If you want, you can register an EIN as a sole proprietor so you don’t have to give out your SSN to clients, open a business bank account, and invoice as many clients as you wish. Come tax time, you’d receive a 1099 from each client and use that to file your taxes. Once you move to Spain, you would register as an autónomo and invoice them from Spain.”
“You’ll need individual contracts with each client, and the end date of the DNV will be the expiration date of the earliest contract. So it’s best if the contracts are indefinite with a cancellation clause. Otherwise, if one is only a one-year contract, your DNV will only be granted for one year, and you’ll have to start the whole process again to apply to extend it.”
“My employer is pushing back on my request to change me from W-2 to 1099, citing IRS restrictions.”
“Spanish employers pay about 30% of their employee’s gross salary to social security. So apart from the technical complications, it also wouldn’t be very practical/affordable for the employee to pay the employer’s portion. For comparison, self-employed autónomos that earn enough for the DNV likely pay less than 15% towards social security.”
“The only way a W-2 employee from the US is accepted, and the reason there are like, five of them total in two years, is that the employer has to agree to register in Spain and pay social security. A huge ask for them. But as long as your clients are businesses and not individuals, you do NOT need to be freelance for a whole year. Just three months. The CLIENT is who needs to be in business for more than a year. As long as your clients are businesses, you can be a sole proprietor, LLC, or even S-Corp—it doesn’t matter to Spain. You’ll still be a freelance autónomo here. Sole proprietor is easiest, with minimal cost or stress to start up.”
“You may be able to switch to 1099 or convince your employer to register in Spain and pay social security. 1099 saves them money, of course. But still not a fun ask, I know. One of these days they might tweak the certificate so that it’s accepted… Recently, Canada did, so they just started being able to come as employees now! It’s a fluid situation, and we never know what changes will happen and when.”
Conclusion
According to Spainguru’s Facebook group members, applying for the Spain Digital Nomad Visa as a W-2 employee of a US company is still highly discouraged unless the employer is willing to register in Spain and pay social security, which is rare.
The best way to qualify remains applying as a self-employed independent contractor. If the applicant directly invoices clients as a sole proprietor (without forming an LLC), only three months of work history is needed.
However, if the applicant sets up an LLC and invoices through the company, then the business must have been operational for at least a year before applying.
Applicants should also ensure that contracts with clients are indefinite or at least cover the visa period to avoid issues with renewal. Since policies and acceptance criteria may evolve, it is always recommended to consult with a legal expert before making major employment changes in preparation for the visa.
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