Jorge Castaño is a consultant in business management systems in Valladolid, where he lives with his partner and their daughter. He has been an autónomo (self-employed) since 2019. In 2026 a German manufacturer hired him to implement its system at its Hamburg plant: from February to May he worked there from Monday to Thursday, with a desk assigned to him in the client's project office, and came home at weekends. In September he spent three weeks in Santiago de Chile giving training to another client. In total he will invoice around 96,000 € over the year, of which 40,000 € relate to the German project. As he prepares the year-end, his question is whether part of his income should be taxed in Germany or in Chile, and whether he has done something wrong by not declaring anything there.
The starting point: you remain resident in Spain
Jorge is not a nomad. His home, his family and the base of his activity are in Valladolid, and article 9.1 of the IRPF Law (Spanish personal income tax) makes him resident in Spain by more than one route: by days counted, by the core of his economic interests and by the family presumption. As a resident, he is taxed in Spain on his worldwide income, including what he earns working in Hamburg or Santiago.
What may happen is that another country also wants to tax part of it. That does not depend on what Spanish law says, but on the law of that country and on its treaty with Spain. And this is where the concept that needs watching comes in.
A self-employed person's permanent establishment
The treaties to avoid double taxation signed by Spain usually reserve the profits of a business or professional activity to the country of residence, unless the activity is carried on in the other country through a permanent establishment or a fixed base. Put simply: a fixed place of business at your disposal from which you carry on the activity for a significant period. Each treaty has its own wording and time limits, and each country's domestic law applies them in its own way.
In Jorge's case, a desk assigned to him on the client's premises for four months is the kind of fact that can be argued over. If Germany took the view that he had a permanent establishment or a fixed base there, it could tax the part of the profit attributable to that activity. Whether it does, and what obligations he would have there, is confirmed by an adviser in Germany; we do not give opinions on German law or promise to handle matters there through third parties. The three weeks in Chile, given their length and nature, in principle carry less risk, but the analysis is still done with the applicable treaty in hand.
If the other country taxes: how to avoid paying twice
If Germany taxed part of the 40,000 €, Jorge would still declare everything in Spain and apply the deduction for international double taxation in article 80 of the IRPF Law: the lower of the tax paid there and the result of applying his effective Spanish average rate to the part of the base taxed abroad. An illustration with assumed figures:
- Net earnings attributable to the German project, after allocating expenses: 30,000 €.
- Jorge's effective average rate in Spain: 27.50 %.
- Cap on the deduction: 30,000 × 27.50 % = 8,250 €.
- If the tax paid in Germany were 7,000 €, the deduction would be 7,000 €.
- If it were 9,500 €, the deduction would stop at 8,250 €, and the remaining 1,250 € would not be offset in Spain.
How the deduction works in full, and when it is better to claim at source, is in tax has been withheld abroad.
VAT does not move with your laptop
A common question is whether working from Hamburg turns the invoice into a German transaction for VAT purposes. The rule in article 69.One.1 of the Spanish VAT Law locates services between businesses at the recipient's seat "regardless of where the service provider is established and of the place from which it provides the services". The German client is a company with its seat in Germany: the invoice goes out without Spanish VAT, under the reverse charge, and is reported in Modelo 349, the EU summary return. The Chilean client, a company with its seat outside the Union: the invoice is not subject to Spanish VAT. Whether Jorge was in Hamburg or in Valladolid when he provided the service does not alter that result.
It is a different matter if the presence in another country comes to constitute an establishment there for that country's VAT purposes, something which, once again, is analysed under its rules.
The article 7.p exemption is not for the self-employed
People who work abroad for a time often hear about the exemption for work carried out abroad. Article 7.p) of the IRPF Law limits it to "employment income received for work actually carried out abroad". Jorge's income is earnings from business activities, not from employment. The exemption does not apply to him, however many days he spends away. Its requirements, for those who are employees, are in the guide to the exemption for work carried out abroad.
Travel expenses, within their limits
What Jorge can do is deduct travel expenses linked to the activity: flights, accommodation and meals. For the self-employed person's own meals, article 30.2.5.c) of the IRPF Law requires them to be taken in restaurants and hospitality establishments, paid by electronic means and not to exceed the limits set by the Regulations for employees' subsistence allowances. For travel abroad with an overnight stay, article 9 of the IRPF Regulations sets 91.35 € a day.
| Item | Days or amount | Limit | Deductible |
|---|---|---|---|
| Meals in Hamburg (with overnight stay) | 64 days, 5,400 € paid by card | 64 × 91.35 = 5,846.40 € | 5,400 € |
| Meals in Santiago (with overnight stay) | 15 days, 1,600 € paid by card | 15 × 91.35 = 1,370.25 € | 1,370.25 € |
| Accommodation and flights | According to invoices | No specific limit, if linked to the activity | Amount supported by evidence |
The 229.75 € excess in Chile is not deductible. And if any meal was paid in cash, that meal is excluded even if it is within the limit.
When travelling to another EU country, a self-employed person who continues to pay contributions in Spain proves that their social security cover is here with the A1 certificate, issued by Spanish Social Security. Without it, the other country may demand contributions there. The certificate is requested before the trip; applying afterwards is possible, but it does not guarantee that the other country will accept the situation retroactively. For Chile, outside the Union, you need to check whether there is a social security agreement and what document it requires.
Before the next long project abroad
What protects you most is planning ahead: knowing, before you sign, how many months the stay will last, whether you will have a fixed space at your disposal on the client's premises and whether the contract presents you as an external supplier or as part of the team. With that information, the adviser in the other country can say whether there is a risk of a permanent establishment and you can decide how to organise the work. If, on the other hand, what you have in mind is moving around with no fixed base all year, the question is a different one and we deal with it in I am a digital nomad: where do I pay.
You can send us your travel calendar and your contracts through the form for self-employed people with international clients. If at some point you spend so much time abroad that another country treats you as resident, the conflict is resolved under the rules described in the guide to dual residence conflicts.
The taxation of self-employed people who provide services in several countries, with VAT, residence and Social Security, is covered as a whole on the Salama Tax page for self-employed people with international clients.