For international families, relocating a family office to Spain can provide access to a stable European jurisdiction and an established professional services market. However, moving the management of a family’s wealth is considerably more complex than simply establishing a company or opening an office.
A family office may coordinate investments, property, family-owned businesses, succession planning and other aspects of a family’s wealth. Moving its management activities to Spain can therefore raise important questions about tax residence, corporate structures, investments, succession and the personal position of family members.
For this reason, the legal and tax implications should be assessed before any structural changes are made.
What Does Relocating a Family Office to Spain Involve?
Relocating a family office does not necessarily mean moving every asset or company to Spain. The key issue is determining which management and decision-making activities will actually take place in Spain.
Before relocating, it may be necessary to establish:
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- Where the family office is currently established.
- Where key decisions are made.
- Who will manage its activities from Spain.
- Whether existing entities could become subject to Spanish tax rules.
- How the relocation could affect investments, property and other assets.
- Whether any family members will also relocate to Spain.
The appropriate approach will depend on the family’s existing structure and how the family office operates.
Tax Residence & Effective Management
One of the first issues to examine is where the relevant individuals and entities are considered tax resident.
For individuals, moving to Spain can potentially result in Spanish tax residence depending on their personal circumstances. This is separate from the tax position of the family office itself.
For companies and other entities, the place where effective management and control takes place can also be relevant when determining their tax position.
Consequently, keeping a family office incorporated abroad does not necessarily remove Spanish tax considerations if its actual management activities are carried out from Spain.
Reviewing Existing Structures & Assets
Before making changes, the family’s existing wealth structure should be reviewed. This may include:
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- Holding and investment companies.
- Family-owned businesses.
- Property in Spain and other countries.
- Investment portfolios.
- Trusts or similar arrangements, where applicable.
- Existing ownership and succession structures.
The objective is not necessarily to replace these arrangements, but to understand how relocating the family office’s management to Spain could affect them.
For families with significant Spanish property or other investments, this review should also consider ownership structures, income generated by assets and any Spanish reporting or tax obligations that may apply.
What does the family need to do?
Relocating a family office to Spain involves several practical steps. The exact requirements will depend on the family’s nationality, assets, existing structures and activities.
01 — Immigration & residence
Family members who are not EU/EEA/Swiss nationals may need to obtain the appropriate visa or residence authorisation before moving to Spain.
The correct route will depend on their individual circumstances and the purpose of their stay.
02 — Tax residence
The family should determine whether moving to Spain will result in Spanish tax residence for any of its members.
This should be assessed separately from the tax residence of the entities managed by the family office.
03 — Tax identification & registrations
Where applicable, individuals and entities may need to obtain the relevant Spanish tax identification numbers (NIE/NIF) and register for the corresponding tax obligations.
04 — Tax returns & reporting
Depending on their circumstances, family members and entities may have Spanish tax filing and information-reporting obligations.
These could include, where applicable, income tax, wealth-related taxes or reporting concerning assets held abroad. The specific obligations will depend on the individual’s residence, assets and structure.
05 — Review the family office structure
If management activities are transferred to Spain, the existing companies, investment structures and other entities should be reviewed to determine whether their tax residence, reporting obligations or legal structure could be affected.
06 — Coordinate the international structure
The relocation should also be coordinated with the family’s existing advisers and the jurisdiction where the family office was previously established.
This can help identify potential cross-border tax, reporting and succession issues before the move takes place.
Important
There is no single checklist that applies to every family office. The steps required will depend on the family’s nationality, countries of residence, assets, entities and the activities that will be carried out from Spain.
Planning the Relocation
A family office relocation should be approached as a strategic legal and tax project, rather than simply a change of address.
Before moving management activities to Spain, families should establish:
- Which activities will actually be carried out from Spain.
- Who will be responsible for managing them.
- Where the relevant entities are currently tax resident.
- How the move could affect existing assets, investments and ownership structures.
- Whether the personal tax and residence position of family members will change.
- Whether existing succession arrangements remain appropriate.
Addressing these points in advance can help identify potential issues before structural changes are made.
Relocating a Family Office to Spain
Spain can be an attractive base for international families, but relocating a family office requires careful coordination between corporate, personal, property and tax matters.
At Fuster & Associates, we assist international clients with the legal and tax aspects of establishing their lives, investments and structures in Spain. Each family office is different, so the appropriate approach will depend on its existing structure, assets, countries of residence and long-term plans.
Contact Fuster & Associates to discuss your circumstances and the legal and tax considerations involved in relocating your family office to Spain.
We want to help you navigate all the legal complexities that come with your home buying in Spain, but this article is legal information and should not be seen as legal advice.
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