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VAT in Spain guide
spain
Standard VAT/GST rate
21%
Reporting currency
EUR
Administered by
Tax Agency

EU VAT guide – Spain

How much is VAT in Spain?

The Standard VAT Rate(Impuesto sobre el Valor Anadido(IVA)) in Spain is 21%. Some supplies are exempted from the Value Added Tax. 

Spain VAT RatesRate TypeCoverage and imposition
21%StandardTo all taxable supplies of goods and services with some exceptions
10% Reduced RateFood, accommodation, catering services 
4%Reduced RateEssential food, books, or medicines
0%Zero rateIntra-community supply of goods; Export; Health care or educational services

VAT threshold in Spain

Valuable information about VAT threshold in Spain and applicable provisions can be found in the VAT legislation. Also, a valuable source of information is an interpretation of the appropriate information shared by Tax Authority officials. 

VAT registration threshold for resident businesses: No registration threshold.

VAT registration threshold for non-resident businesses: No registration threshold.

VAT registration threshold for intra-EU distance sales of goods and B2C supplies of services: EU-wide harmonized threshold of EUR 10,000.

VAT registration threshold for non-EU established suppliers of Electronically Supplied Services: No registration threshold.

VAT Taxable Activities in Spain

The supplies of goods and services made in Spain by economic operators for consideration as part of their regular business activities are subject to VAT. 

From a VAT perspective, these operators are taxable and should register for tax. Here, we can find natural persons conducting professional activities, legal persons, and entities without legal status.

Types of taxable activities that trigger the imposition of VAT: 

  • The supply of goods and rendering of services in Spain for consideration;
  • Import of goods;
  • Intra-community acquisition of goods for consideration;
  • Export in non-EU countries.

There are also other case scenarios where domestic or foreign businesses should impose Spain VAT on their transactions.

Tax Representative in Spain

For non-EU-established businesses, having a tax representative for all VAT compliance-related activities is mandatory. 

For EU resident businesses, there isn’t such a requirement. Still, the economic operator could acquire the professional to ease up and streamline compliance challenges for its operations in the country. 

VAT on Electronically Supplied Services in Spain

Electronically Supplied Services 

EU VAT Directive 2006/112/EC defines Electronically Supplied Services as services delivered over the Internet or through other related electronic means. Their nature makes their supply automated, with minimal or no manual human intervention. The existence of information technology is detrimental to the possibility that these services could be rendered as they should be. 

Spain has transposed the EU-wide and harmonized definition of Electronically Supplied Services into the national legislation.

In some countries, we often cross our ways with terms such as digital services, digital products, and electronic services.

In most cases, from the EU VAT Directive liability perspective, this is meant by the definition and coverage of electronically supplied services. 

Taxability Rules for ESS

B2B supply of electronically supplied services – The general place of supply rules should be applied

B2C supply of electronically supplied services – Non-resident companies should apply EU-harmonized VAT rules specifically designed for this purpose, i.e., that VAT rate of the consumer’s place of residence

Place of supply rules for distance sales of goods and B2C ESS supply of services – If the annual turnover of the supplier is less than EUR 10,000, the merchant can apply VAT rules of his country of residence or follow the OSS rules

Place of supply rules for distance sales of goods and B2C ESS supply of service – If the annual turnover of the supplier is above the threshold of EUR 10,000, the seller should impose the VAT rate of the country where the goods are dispatched or where the customer receiving the services is based

How much is VAT in Spain for Electronically Supplied Services? 

VAT rate Spain: A standard VAT rate of 21% is applied in most cases on sales of Electronically Supplied Services in Spain

Examples of taxable ESS in Spain:
Supply of digital products, such as software, connected changes, and updates of the software
Website supply, web-hosting, distance maintenance of programs and equipment 
Supply of music, films, and games, including games of chance and gambling games 
Supply of distance learning 
Access or download of music to a physical device
Access or downloading of the images, jingles, films, ringtones, and other audio output 

E-Commerce VAT Rules in Spain

The E-Commerce package promulgated on July 1, 2021, has been accordingly transposed to the national VAT legislation. 

The European Union’s legislation has significantly changed European electronic commerce operations. The legislator was guided by the willingness to simplify administrative burden and harmonize rules and regulations related to e-commerce operations within the EU. 

These changes can be most vividly described by looking at the expansion of the frame of transactions covered by EU-harmonized legislation regarding E-commerce. 

The new provisions cover the following transactions:

  • Distance sales of low-value goods imported in consignments with a value below EUR 150 from third countries or third territories and successively carried out by suppliers and deemed suppliers except for goods subject to excise duties;
  • Intra-community distance sales of goods carried out by suppliers or deemed suppliers;
  • Domestic sales of goods by deemed suppliers;
  • Supplies of B2C services by taxable persons not established within the EU or by taxable persons established within the EU but not in the customer’s Member State.

New provisions introduced by the E-Commerce legislative package modified the structure of EU VAT special schemes introduced through previous legislation. 

The previously available schemes were updated, and the IOSS scheme has been introduced.  

The E-Commerce VAT package made the following special schemes available:

  • Union One-Stop-Shop Scheme;
  • Non-Union One-Stop-Scheme;
  • Import One-Stop-Shop Scheme.

Overview of EU VAT Special Schemes 

The Non-Union Scheme can be used by:

Non-EU established businesses and those without fixed establishments in the EU. 

The Non-Union Scheme covers B2C supplies of all services where the place of taxability is within one of the Member States. If the merchant opts to use this scheme, it must use it to collect tax for all B2C sales in the EU. 

The Union Scheme can be used by:

Taxable persons established in the EU for supplies of B2C services having a place of taxability other than the one where the supplier is established and for intra-community distance sales of goods. 

Taxable person not established in the EU for intra-community distance sales of goods.

Digital Marketplace established or not established in the EU for intra-community distance sales of goods and for certain domestic supplies of goods.

Import Scheme can be used by:

Any taxable person who carries out distance sales of goods imported from third countries or third territories in consignments not exceeding the threshold of EUR 150 sold to customers in the EU.

Taxable persons established in the EU, taxable persons non-established in the EU, and electronic marketplaces are eligible to use this type of special scheme.

OSS Return and Payment 

The VAT Spain rules don’t offer a simplified regime for registering non-resident economic operators performing electronically supplied services or distance sales of goods. 

The non-resident business can adhere to one or more of the special OSS schemes to comply with its VAT liabilities imposed by Spain. 

If the taxable person in question supplies goods and/or services from the specifically designated list governed by the E-Commerce rules, only then and to that extent can benefit from the advantages of the OSS schemes.

Suppose there are types of supplies that are beyond this list, or some other parameters are outside stipulated boundaries. In that case, the non-resident business should follow the local registration procedure and comply with the local VAT regulations. 

OSS Return(Model 369-) – In case Spain is the Member State of Identification(MSI)
VAT Return NameOne Stop Shop Scheme(OSS)
Reporting PeriodQuarter
Submission DeadlineQ1-April 30; Q2-July 31:Q3-October 31; Q4-January 31
Payment DeadlineSame as for the electronic submission of declaration
Payment CurrencyEUR
Language Spanish or English
Tax RepresentativeFor Union and Non-Union Scheme – No
IOSS – if the taxable person is established outside EU – Yes 
Input Tax CreditNot allowed in the OSS return 
Archiving10 years 

Electronic Platform and Deemed Supplier Rules 

Spain has transposed into national legislation the harmonized EU VAT provisions that define the institute of deemed supplier, its coverage and applicability. 

The taxable person who facilitates the supply through a digital marketplace should be held as a deemed supplier when the indicated conditions are met. 

Deemed supplier provision activates for the following supply of goods

  • In cases when the goods are imported in consignments from third countries or third territories with a value of less than EUR 150 and sold by the underlying supplier to EU customers;
  • In cases of supply of goods that are located in the EU and are in free circulation therein, sold by non-EU established underlying supplier to customers residing in the EU without any limitation related to the value of the goods.

The deemed supplier VAT provision introduced new liabilities and formed how the sale from the underlying supplier to the end customer is processed when the supply is facilitated through digital platforms. 

The sale through the electronic platform is divided into two supplies: 

  1. Supply from the underlying supplier to the electronic platform(deemed B2B supply);
  2. Supply from the electronic platform to the end customer(deemed B2C supply).

In the cases where the digital platform is treated as the deemed supplier of goods, it is required to record and archive compulsory VAT data as any other taxable operator to demonstrate compliance during the audit. 

The Digital Platform Operator should consider that the record-keeping requirements defined by the OSS  or IOSS scheme, which apply to any taxable supplier using those schemes, are applied to them as well.

Invoice Requirements in Spain

General invoice information:

  • Date of Invoice issuance;
  • A unique invoice number issued in sequence in one or more series if applicable;
  • Information about advance payment or delivery of goods/services with accompanying precise description if this has happened before the invoice issuance date.

Seller information:

  • Business name;
  • Full address;
  • NIF and/or additional TIN identification when found necessary.

Buyer information:

  • Business name;
  • Full address;
  • NIF number of the registered taxpayer.

Fiscal Information:

  • Description and breakdown of the goods or services – quantity, discounts, unit price excl. VAT;
  • Taxable amount;
  • The VAT rate(s) applied, and the breakdown of VAT per rate;
  • Invoice Total.

Additional information required in particular cases:

  • Exemption reference – guaranteed by precise norm;
  • Reverse charge – description;
  • Self-billing – description;
  • Tax Representative information.

Foreign Currency Invoice in Spain

In Spain it’s permissible to issue tax invoices in foreign currencies, but the requirements dictate that  total VAT amount and VAT breakdown per rate should be indicated in EUR, as well as exchange rate and conversion detail in both cases. For the conversion rate, the exchange rate published by the ECB valid on the date of supply of goods or performance of services should be used.

VAT Returns in Spain 

Domestic returns 

Domestic taxpayers, and non-established foreign businesses registered for VAT Spain who conduct economic activities under the national rules should submit monthly or quarterly declarations in most cases based on their turnover. 

In general, the fillings are done every quarter. It will be monthly for large enterprises or those registered in the monthly refund register.

Monthly filing should be completed by the 20th day following the reporting month. Quarterly filing should be completed by the 20th day of the month following the quarterly reporting period. The payment of owed tax should be made within the same deadlines. 

Annual VAT return is also required for specific VAT taxpayers. 

Penalties for late reporting and omitted declarations

Taxpayers are obliged to charge Spain VAT on their transactions unequivocally and submit the VAT return within a fixed timeframe. 

Taxpayers who submit the VAT return after the deadline can expect to allocate more funds than they would if it has filled the return during the fixed period. 

When taxpayers don’t comply with the VAT rules in Spain, the responsible tax authority can impose a fine for non-compliance. 

The type of additional expense, amount, and way it is processed depends mainly on the following parameters.

If the return has been filled after the deadline but without the prior request/reminder from the Tax Agency or if the late return has been filed after the explicit request from the responsible tax authority. 

  • Filling the late return without prior request from the Tax Authority will impose a mandatory surcharge for the taxpayer. The surcharge amount depends on how much time has passed since the fixed deadline for the filling in question. 
  • As regards the penalties and fines from the other side, they are pronounced by authorities when there is a notice from the responsible authority to the taxpayer to pay his debts to the Treasury. The penalty can go from 50% to 150% of the VAT amount owed(with a possible reduction in specific cases). The degree of penalty depends on the amount of VAT owed, the severity of the penalty, and other factors. 

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