Can you pay tax in the UAE while living in Spain? The truth about tax residency and the digital nomad visa

               Greetings readers — more and more internationally minded professionals are seeking to establish residence in countries with favourable tax regimes, and the United Arab Emirates (UAE) sits firmly at the top of that list. The appeal is clear: there is no personal income tax, business taxation is minimal, and the country’s digital infrastructure allows for seamless remote work.

               However, many who return to Spain or maintain part of their professional and family life here are unaware that living in Spain generally makes them Spanish tax residents, meaning they are legally required to declare their worldwide income to the Spanish Tax Agency — even if they hold a so-called “digital nomad visa” or residence permit in Dubai.

               In this article, we’ll explain clearly how tax residency between Spain and the UAE actually works, what it means to have a digital nomad visa, and the real conditions required to pay tax exclusively in the Emirates.

1. HOW THE 183-DAY RULE DETERMINES YOUR TAX RESIDENCY IN SPAIN

               The starting point lies in Spain’s Personal Income Tax Law (IRPF). Spain considers you a tax resident if you meet any one of the following conditions:

1. You spend more than 183 days in Spanish territory during a calendar year.
2. Your main base of business or economic interests is located in Spain, directly or indirectly.
3. Your spouse (not legally separated) and/or minor children reside habitually in Spain.

               Meeting even one of these criteria is enough for the Spanish Tax Agency to classify you as a Spanish tax resident. The immediate consequence: you must pay tax in Spain on your worldwide income — that is, on everything you earn both inside and outside the country. This includes salaries, rental income, business profits, investments, and dividends, even if they come from the UAE or any other country.

2. WHAT “WORLDWIDE INCOME” MEANS IN PRACTICE

               The concept of worldwide income means that Spain taxes everything you earn, regardless of where it is generated. Imagine you work for a company registered in Dubai, receive your salary into a UAE bank account, and even hold a residence visa there. If you spend more than six months per year in Spain or maintain your centre of economic interests here, Spain can still claim income tax (IRPF) on that income.

               Although the UAE does not levy income tax, that does not exempt you from declaring the income in Spain. And since no tax is paid in the country of origin, you cannot apply any foreign tax credit, meaning the Spanish IRPF would be payable in full.

3. THE MYTH OF THE “DIGITAL NOMAD VISA” IN THE UAE

               In recent years, the UAE has launched several residency programmes aimed at international professionals. The most well-known is the Remote Work Visa, or Digital Nomad Visa, which allows you to live legally in Dubai or Abu Dhabi while working remotely for a foreign company.

               The tax appeal is obvious — the UAE levies no personal income tax, and with minimal withholding, it seems ideal. But this advantage only applies if you are genuinely a tax resident in the UAE, which does not happen automatically upon obtaining the visa.

               Administrative residence (holding a visa or residence permit) is not the same as tax residence. For Spanish authorities to recognise your tax residence in the Emirates, you must prove that your economic and personal life are centred there, and that you spend fewer than 183 days per year in Spain.

4. THE SPAIN–UAE DOUBLE TAXATION AGREEMENT: WHAT IT DOES AND DOESN’T COVER

               Spain and the United Arab Emirates signed a Double Taxation Agreement (DTA), in force since 2007, to prevent the same income from being taxed in both countries. The DTA sets out tie-breaker rules to determine where a person with links to both countries is considered a tax resident. The criteria are applied in the following order:

1. Permanent home: where the individual has a habitual residence.
2. Centre of vital interests: where their personal and economic relations are closest.
3. Habitual abode: where they spend more time during the year.
4. Nationality, as a last resort.

               Therefore, even if you hold residence in Dubai, if you spend more than half the year in Spain, maintain family or business ties here, and your personal and financial connections remain in Spain, the DTA will conclude that you are still a Spanish tax resident. In that case, Spain has the right to tax your worldwide income, regardless of the UAE’s tax-free system.

5. WHAT YOU’D NEED TO PAY TAX ONLY IN THE UAE AS AN UAE RESIDENT

If your genuine goal is to transfer your tax residence to the UAE and cease to be a Spanish tax resident, you must go well beyond obtaining a visa. It’s about changing your economic and personal reality, not just your postal address. In practice, this means:

1. Spending fewer than 183 days per year in Spain, with accurate documentation of entry and exit dates.
2. Moving your economic base — main sources of income, primary bank accounts, business or invoicing — to the UAE.
3. Obtaining a Tax Residency Certificate (TRC) issued by the UAE Ministry of Finance.
4. Not maintaining a permanent home in Spain, or proving that it is only a secondary residence with limited use.
5. Relocating your family, if applicable, as the residence of a spouse or minor children is a decisive factor.

Meeting all these conditions does not automatically guarantee that the Spanish Tax Agency will accept your new tax residency, but it is the only defensible path if an audit were to occur.

6. THE POSITION OF THE SPANISH TAX AGENCY REGARDING UAE RESIDENTS WITH SPANISH NATIONALITY

The Spanish Tax Agency bases its assessment of tax residency on objective facts, not intentions. Even with a valid UAE visa, if you maintain significant ties in Spain, the authorities may still consider your effective residence to be here.

The Agency uses digital tools to detect inconsistencies between lifestyle, spending patterns, property ownership, vehicle registration, energy consumption, and family residence. If they conclude that you are pretending to live abroad while remaining effectively in Spain, they may impose severe penalties, demand unpaid IRPF plus surcharges and interest.

Maintaining a nomad visa in Dubai while living mostly in Spain is therefore a high-risk fiscal strategy, especially amid tighter controls on international financial data and cross-border movements.

7. WHAT ARE THE REAL ALTERNATIVES FOR UAE RESIDENTS?

               For those seeking a flexible and tax-efficient lifestyle, moving to the UAE can indeed be a legitimate option — provided the relocation is real and properly structured. The best approach is to plan your tax migration in advance. We recommend obtaining professional advice before the move, setting up a UAE-based company (for instance, within a Free Zone) if you intend to invoice from there, then applying for a UAE Tax Residency Certificate after completing a full calendar year of genuine residence.

Finally, you should update your situation in Spain — deregister from the local census, inform your town hall, and notify the Tax Agency of your change of tax residence via Form 030. Proper planning avoids penalties, residency disputes, and tax claims for simulation. Our team can guide you through every step to optimise your tax situation with full legal security.

IN CONCLUSION…

               Living in Spain means paying tax in Spain — unless you can clearly and convincingly prove tax residence abroad. Neither nationality, visa type, nor postal address alone determines tax status. If you live primarily in Spain, maintain your family or main economic interests here, you will remain a Spanish taxpayer for IRPF purposes — even with a digital nomad visa in the Emirates. The UAE tax regime is undoubtedly one of the most attractive in the world, but to benefit legally, you must meet all the requirements for genuine residence outside Spain and be able to document them before the authorities.

At Servicios de Extranjería, we assist international professionals and entrepreneurs with their fiscal mobility planning, helping them to stay compliant while optimising their taxation with full legal certainty.

👉 Contact us today for a personalised consultation and start shaping your financial future in Spain.