RSUs in Spain. There is no RSU as such in Spain: there is a delivery of shares that the law treats as payment in kind, with valuation and timing rules that depend on how your plan is drafted. It is the kind of question where one clause changes the final figure.
Karim Benali holds French and Moroccan nationality and has lived in Málaga since 2021. He is chief technology officer of a start-up based in Lyon, for which he works as an employee of its Spanish subsidiary. In 2022 he subscribed for 10,000 bons de souscription d'actions (BSAs), a kind of warrant, paying 0.40 € each: 4,000 € out of his own pocket. Each BSA allows him to buy one share at 3 €. In 2026 he exercises all of them, paying 30,000 €, when the share is worth 18 €, and that same year the company is bought and he sells the 10,000 shares at 18 €. His colleague in Lyon has told him that because he paid for the BSAs "they are an investment, not salary". Karim wants to know whether that also holds in Spain.
Warrant, BSA and option: similarities and differences
A warrant is a right to subscribe for or buy shares at a fixed price during a period. In that sense it resembles an employee option. The practical difference usually lies in two features: warrants are often subscribed for by paying a price, and they are sometimes issued to people who are not employees, such as advisers, board members or investors. BSAs are the French instrument of this kind. How French law treats them is for the client's adviser in France to confirm; here we only analyse how Spanish income tax (IRPF) classifies them for a resident of Spain.
The guide on warrants and BSAs sets out the framework. In this answer we focus on Karim's question: pay or investment?
The decisive question: why do you hold them?
Article 17.1 of the Spanish Income Tax Act treats as employment income any benefit deriving directly or indirectly from the employment relationship. If Karim received the BSAs because he is the chief technology officer, and their future value depends on his staying with the company, the advantage he obtains on exercise is, in principle, pay for his work, even though he paid something for them. If, on the other hand, he subscribed for them like any other investor, paying their real value and taking the risk with no conditions linked to his employment, what he earns will be the result of an investment.
There is no written rule that settles every case. It is the facts that tip the classification:
| Indicator | Points to pay | Points to investment |
|---|---|---|
| Who can subscribe | Only executives or employees | Outside investors too, on the same terms |
| Price paid | Token, or far below their value | Equal to the market value set by an independent third party |
| Service conditions | Lost or bought back if you leave | Not dependent on your employment |
| Transferability | Non-transferable | Freely transferable |
| Risk | Very little of your own money at stake | A real investment that can be lost |
Karim paid 4,000 €, but if the plan says he loses the BSAs on leaving the company and only executives could subscribe for them, the balance tips towards pay. Paying a price does not on its own turn pay into investment.
There is a third possibility worth bearing in mind. If the BSAs had been transferable from the outset and worth more than Karim paid, the advantage might already have been obtained in 2022, on subscribing for them below their value. In that case, the employment income would be the difference between that value and the 0.40 € paid, and whatever came afterwards would be treated as investment. It is less common, but it depends on what the issue agreement says.
The same figure in two different bases
The classification changes not so much the amount as the moment and the base in which it is taxed. Let us look at both readings with Karim's numbers:
If it is pay:
- Value of the shares on exercise: 10,000 × 18 = 180,000 €.
- Paid on exercise: 30,000 €.
- Paid to subscribe for the BSAs in 2022: 4,000 €.
- Employment income in kind in 2026: 180,000 − 30,000 − 4,000 = 146,000 €, in the general base.
- Acquisition value of the shares: 4,000 + 30,000 + 146,000 = 180,000 €.
- Sale at 18 €: capital gain of 0 €.
If it is an investment:
- In 2022 and 2026 there is no income: Karim merely acquires a right and then some shares.
- Acquisition value of the shares: 4,000 + 30,000 = 34,000 €.
- Sale: 180,000 €.
- Capital gain: 146,000 €, in the savings base.
The 146,000 € are identical. What changes is the scale that applies: that of the general base or that of the savings base. If a year passed between exercise and sale, the tax year would change as well.
If the subscription price was a token one or was not backed by an independent valuation, Hacienda, as the Spanish tax office is commonly called, may consider the difference to be pay and adjust the general base, with interest and, where applicable, a penalty. Nor can it be ruled out that it will dispute an investment classification even if the price was reasonable, if the other indicators point to employment. We do not guarantee either reading without examining the documentation.
If you are an adviser rather than an employee
Warrants are also given to outside advisers and board members. If Karim provided services to the start-up as an independent professional and invoiced for them, the advantage linked to those services could be classified as income from his business activity, not employment. The classification changes some obligations, but the reasoning is the same: if the warrants reward services, their advantage is income from those services. If you are a director of the company, directors' remuneration is employment income by express provision of article 17.2.e).
The papers that make the difference
To defend an investment classification, Karim would need:
- the valuation report that justified the price of 0.40 €;
- the issue agreement, to see who could subscribe and on what terms;
- the lapse or buy-back clauses if he leaves the company;
- proof that the 4,000 € were paid with his own money.
If those documents show that the BSAs were a tool for retaining executives, the prudent course is to declare employment income. You can send us the issue agreement and the valuation through the equity form so that we can review which way they lean.
Other closely related situations
If the exercise and the sale coincide with the purchase of the company, the clauses of the acquisition agreement may add service conditions that turn part of the price into salary; we cover this in the company is bought and my shares are paid for. If the company were an accredited Spanish emerging company, the warrants or options could benefit from the rules on equity in a Spanish start-up. And if you work in Spain under the article 93 regime, the difference between employment income and gain matters even more, because only employment income is treated as obtained in Spain: see the Beckham regime and shares.
The line between pay and investment in warrants, BSAs and similar instruments is one of the matters we explain on the Salama Tax page on equity.