The Canary Islands has become an attractive destination for those known as “digital nomads”: people who combine work and travel.

The implementation of remote work thanks to the pandemic along with the reduction of fixed costs associated with it, has multiplied the number of people working from home. Untethered from the office space, the number of people looking for new places from which to conduct their business has grown exponentially. And the Canary Islands have become a national benchmark.

A good internet connection, eternal good weather, coworking spaces or hotels with free wifi are some of the requirements that these modern nomads require, whether they are foreigners or nationals, and that they can find on the islands. But if there is one thing the islands have that the rest of the territory cannot offer, it is certain fiscal particularities and tax benefits.

Tax Benefits

The Canary Islands have a special Economic and Fiscal Regime (known as REF) compatible with European regulations as a result of the recognition of the Canary Islands as an ultra-peripheral region of the European Union, where companies/entrepreneurs can benefit from powerful tax incentives. We highlight:

Canary Islands Special Zone (ZEC): the ZEC is one of the most interesting tax instruments for companies wishing to set up in the Islands. By complying with certain minimum job creation and investment requirements, companies can be taxed at 4% on corporate income tax (hereinafter, IS).

Investment Reserve in the Canary Islands (RIC): Thanks to the RIC, and always with the limitations established by the State Aids, companies/entrepreneurs can reduce the tax burden by up to 90-80% of the business and/or professional profit, provided that certain investments are subsequently made.

Deduction for Investments in Fixed Assets (DIC): The DIC also stands out as a tax incentive, as it reduces taxation by 25% of the amount destined to the acquisition of fixed assets.

Likewise, the Canary Islands General Indirect Tax (hereinafter IGIC) stands out, with a general rate of 7%. This consumer tax is similar to the VAT in the Peninsula or to the European Union’s VAT and other excise taxes, but is much lower than in other territories of the Union.

Best of all, these benefits are not exclusive to nationals, they also apply to foreign businesses and individuals.

Do you want to benefit from the ZEC? Ask us!

At Kepler-Karst we can help you with the tax strategies of your economic and business sector, whether they are traditional sectors such as industry and commerce, or newer ones such as the audiovisual world, ICT, business services, subcontracting, maritime sector…

Thanks to these benefits, the Canary Islands is the ideal destination to start being a nomad.