Getting a Spanish VAT registration can be complicated, so it is advised to have a corporate lawyer to help you set up your business properly. And with the Wise Business debit card, you can spend like a local, wherever you are.. Sign up now for free, and do business without borders. One of our lawyers will contact you to explain all the process about the VAT (IVA) in Spain. Your shipment to Spain as a non-Spanish trader is called an intra-community shipment and is not subject to tax nevertheless it has to be proven with the help of pro-forma invoices. What is the Spanish Value Added Tax (VAT) and how it works, types of transactions subject to VAT in Spain Given the proximity of the mandatory submission of the quarterly and annual Spanish VAT returns, we would like to dedicate a few lines to a tax that is governed by one of the most complex legislations existing in Spain. Make sure you collect the following when you are doing your administration. Book your business trips with TravelPerk to make it easy to get up to 21% of your spend back. This percentage level is applied to all the taxable goods and services that are not included in the following sections, which basically include: The super-reduced type is equivalent to just 4%, and is applicable to basic necessities. ESX1234567X. Spain has experimented a lot with different tax rates in the past. The main reason for Spanish VAT registrations are: Is one of these scenarios apply to you? And, finally, those services and products that are VAT-exempt. These cookies will be stored in your browser only with your consent. Get a free, Europe-wide, VAT assessment in minutes. What Is Vat In Spain - Homey Gears If you are an individual, only a Spanish bank account will be allowed to make any transaction with the tax office or government agencies in Spain. VAT in local languages. It is mandatory to procure user consent prior to running these cookies on your website. Is your business importing goods from abroad, or are you preparing for your travels? This document lists your companys address and directors. If you exceed the delivery threshold with your sales to Spain or store your goods there temporarily, you must register for the VAT there. At the end of each quarter (on March, June, September, and December) you will need to declare and pay to the Spanish Tax Agency that amount you have been collecting for the past 3 months. International air or sea travel is seen as an economic growth factor because a lot of businesses use air and sea to import and export goods that are made available to improve the lives of the citizens, which help improve the standard of living. Since you need a VAT ID as soon as you reach the delivery threshold or start storage, you should plan ahead and apply for the VAT ID early. We highly recommend seeking guidance from a legal expert if you lack extensive knowledge or experience dealing with any of the procedures outlined in these articles. VAT is charged on the following types of transactions: Spanish VAT is levied on the supply of goods and services made in Spain by taxable persons. Inaccuracies in the figures are checked against the VIES system on a regular basis, and inaccuracies can result in delays or even fines. We explain when your business has to register and how to handle and automate VAT duties with our hellotax software in order to stay VAT compliant across the EU. Sometimes it simply hasnt been activated yet, for example. If I purchase furniture for that apartment,can I claim the VAT back? Typically, your VAT return in Spain is due four times a year, quarterly and one time annually. If I ship something to my daughter in Barcelona when she is studying abroad, can I be refunded the VAT tax she had to pay to receive the package? This number is called ROI, and you can find all the information in this article in which we explain all the details. In Spain VAT is called the IVA, which stands for (Impuesto sobre el valor aadido). Learn how you can make VAT rates work in your favour. There are two lower rates of 10% and 4%. The first two are the classic country code, in this case ES. In Spain, there is a sales tax that is called IVA or VAT (in Spanish Impuesto sobre el Valor Aadido), a tax applied on retail sales or services provided by professionals. The VAT is a consumption tax assessed on the value added in each production stage of a good or service. You will pay your VAT at the Spanish tax office called Agencia Tributaria (Agencia del impuesto de sociedades). the standard VAT rate must be above 15%). These VAT rates should be used by providers of taxable services when selling their goods. Similar to a sales tax or excise. One of our lawyers will contact you to explain all. You can find the calendar with due dates on the website of the Spanish tax authorities: While the VAT return dates will be set by the local tax authority where you have registered your vat number, there are some general national guidelines. EU country codes, VAT numbers and enquiry letters for EC Sales Lists It is applied to goods or services in Spain. Our briefing on Spanish VAT Registrations explains the details of the registration process, including the local VAT registration threshold. Do people in Spain also have a VAT number? VAT stands for "Value added tax" and it's a tax in Spain that has to be paid when selling goods and services. Heres an example: So, youve done some shopping abroad, and paid a healthy amount of money for VAT. Sign up to our free eCommerce newsletter and receive tips on growing your ecommerce business VAT compliant. VAT Rates in Spain Explained - Wise Spain follows the broad EU VAT rules on the requirement for foreign companies to register for local VAT. Global VAT Compliance B.V. is not responsible for the accuracy of the information on these pages, and cannot be held liable for claims or losses deriving from the use of this information. We also use third-party cookies that help us analyze and understand how you use this website. These cookies do not store any personal information. For imports, it is the time of importation. This covers the details of Spanish VAT registrations, compliance and returns . IVA, short for 'Impuesto sobre el Valor Aadido', is the UK equivalent of VAT. Documents required to apply for your Spanish VAT ID: If you want to get more information on the duration of the registration process, please read this article. Types of IVA in Spain. I am having veterinary service done in Spain on an animal that will be transferred to the US. Even though also in Spain, everything we have covered so far does not apply to the Canary Islands. The tax rates in Spain. Originally, the Spanish VAT number was known as Cdigo de Identificacin Fiscal. When you are travelling in Spain as a non-EU resident, you can request to fill in a Tax-Free form in the shops where you buy your purchases. What services are exempt from VAT in Spain. Last five digits: random digits. As long as you remain under the annual turnover, you still pay tax on your product sales in your country. Various papers are needed in order to register the VAT ID. Besides VAT, there are several types of sales tax imposed on businesses in Spain. Avalara has a range of solutions that can help your business depending on where and how you trade. These VAT rates should be used by providers of taxable services when selling their goods. This covers the details ofSpanish VAT registrations, complianceand returns. After approximately 60 days, you will get your VAT refund through your credit card. Spain sets the level of its VAT rates. Correct invoicing of customers for goods or services in accordance with the Spanish time of supply VAT rules. Your VAT in Spain is used to report your taxable income and revenue tax. North America Country VAT Guide - Avalara, US 2021 sales tax updates for foreign businesses, Suministro Inmediato de Informacin (SII), Buying and selling goods within Spain if the supplier and customers are not Spanish company with a VAT registration (reverse charge applies), Selling goods to Spanish consumers over the, Charging admission fees to live events or exhibitions in Spain. While the general VAT rate is 21%, the reduced VAT rate is 10%, and the super-reduced VAT rate is 4%. VAT In Spain In 2023 | All The Information | My Spain Visa The information provided by Global VAT Compliance B.V. on this webpage is intended for general informational purposes only. You can find these VAT numbers in the official mercantile directive (RMC). Intra-Community acquisitions of goods. Enquiry letter. Once your form is validated by Customs or the electronic service, youll have two ways to reclaim your VAT. IVA in Spain: All you need to know about Spanish VAT VAT Rates in Spain - Rates for all goods & services - Global VAT Compliance The registration of the VAT number is not yet completed. If a business is holding goods in a consignment warehouse located in Spain, it is deemed as a holding for a permanent business and therefore must have VAT registration. This is seen as a positive contributor to economic growth and is also exempt from VAT in Spain to encourage more people to participate and make it easier for businesses to accomplish their goals. An alternative to registering in all countries is the One-Stop-Shop (OSS). The VAT reclaim process has never been quicker or easier. I am based in the UK and buying goods from Spain. It is applied to even more basic necessities such as: Some products are not charged with VAT at all in Spain. Its designed to be paid by the consumer at the end. The first two are the classic country code, in this case "ES". That is why it is an indirect tax levied on consumption, and it is completely independent of your income level (as opposed to income tax). Buying a service in Spain, ie, veterinary from the US.is that VAT taxable. Under no circumstances should the information listed be considered professional legal advice. This category only includes cookies that ensures basic functionalities and security features of the website. These taxes are to become effective starting January 2021. If you pay the amounts within the deadline stipulated in the letter with penalties stated, you can reduce them by 25%. Get taxes done more quickly and efficiently with our tax services in Spain. This is applied to all goods and services that are taxable.The 10% reduced rate is applied to a number of essential social areas such as certain foods, water bills, select medical and pharmaceutical equipment and products, all domestic transport services and any inland international transport taken by road or rail, agricultural supplies, social housing and covers certain repairs and renovation, hotel accommodation, waste collection, select social services, select soft drinks, bars, cafes and nightclubs, alcoholic beverages, admission to amateur sporting and cultural events, water treatment and waste management. The VAT rate in Spain is 21%. That is the case of some services provided by registered professionals, like medical services provided by dentists, doctors, or opticians. I am living in the US. The NIF consists of a total of eleven characters. This is true for overseas firms as well. If you wish to receive VAT related information please contact our experts atsupport@gvc.tax. The euro is the currency in Spain. Known as IVA in Spain, VAT is currently set at 10% of the purchase price, except in the Canary Islands. All rights reserved. Taxes in Spain: an introductory guide for expats | Expatica avalara:content-tags/asset-type/blog-post,avalara:content-tags/tax-type/vat,avalara:content-tags/location/world/europe/spain, Retail, ecommerce, manufacturing, software, For online, ecommerce and bricks-and-mortar shops, For apps, downloadable content, SaaS and streaming services, For manufacturers with international supply chains, Insurance tax compliance software for policy providers, brokers, and agents, Partnerships, automated solutions, tax research, education, and more, An omnichannel, international sales solution for tax, finance, and operations teams, Manage registrations, simply and securely, Join us virtually or in person at Avalara events and conferences hosted by industry leaders, Check U.S. nexus and tax responsibilities. Entry tickets to museums, parks, monuments, shows, Pharmaceutical products and medicinal products for human use, Social services, such as construction work on social housing, Books, newspapers and magazines not containing advertising, Intracommunity and international transport. Necessary cookies are absolutely essential for the website to function properly. Spain also has some zero-rated goods, the sale of which must still be reported on your VAT return, even though no VAT is charged. Spain has opted for the reduced and super-reduced VAT rates on a number of items allowed by the VAT Directive (source: European Commission) Individual information can be obtained during a consultation call with our VAT specialists. In any case, the tax office will determine when and how often you have to submit your VAT returns. Value Added Tax or VAT is the consumption tax a country sets on a product according to the value added at each stage of its supply chain from production to final sale. You can ask for the DIVA form from the shops where you make your purchases and validate it at the automatic terminals that are found at the airports and main ports in Spain. For the second reduced VAT rate (4%), multiply the original price by 1.04. Foreign businesses do not need to form a local company to do business in Spain because they fall under the non-resident VAT trading. Youll have your refund issued immediately in Euros by cheque, bank transfer, to your credit card or in cash. It is vital to fully understand the Spanish tax system to avoid misunderstandings and ensure that you do not make inappropriate decisions with regards to investments, business and private transactions. Alicante has Alicante-Elche Airport and the Port. Is my business VAT exempt? Visit this page for an executive summary of Spain's tax structure and rates, by SalesTaxHandbook. There is no VAT threshold for traders to be registered in Spain; before the start of taxable transactions, a VAT number is required. VAT Spain: Rates, Types, Meaning, Due dates, and FAQ, https://www.spaindesk.com/wp-content/uploads/2021/06/9.jpg, https://www.spaindesk.com/wp-content/uploads/2021/05/31-05-2021-Spaindesk-Logo-1.png, All rights reserverd Copyright - SpainDesk, The super-reduced VAT rate in Spain (4% IVA). To get this number you must register with your (local) branch of the Administracin de la Agencia Estatl de Administracin Tributaria (AEAT). Any VAT due should then be declared in the subsequent VAT return. As long as the purchase at any specific store is higher than 90 and that it took place in any of the shops that offer this tax-free regime (check for that sign before entering), you will be able to claim your sales tax money back. Under no circumstances should the information listed be considered professional legal advice. VAT in Spain is applied to any businesses that sell goods or services that may be taxable under Spanish law. Certain printed books, newspapers and magazines. An example of the NIF-VAT number is ESB73475571. I have the opportunity to sell on a small scale some sculptures which I make. The standard vat rate is 21% but certain goods and services are eligible for the reduced rate of 10%, 4% or 0%. For the first reduced VAT rate (10%), multiply the original price by 1.1. Spain's consumption tax is called the Value-added tax (VAT), locally known as Impuesto sobre el Valor Aadido (IVA), which was introduced in . For a household removal service? Spanish zero-rated goods and services include some gold coins, bars, intra-community and international transport. Paying property tax in Spain - Wise The first digit of the NIF-VAT number is always an ES, which stands for Espanol. Impuesto sobre Bienes Inmuebles (IBI): The IBI is the equivalent of property tax and is payable by the owners of buildings, although it can also be paid by renters. Non-commercial entities such as public bodies carrying out an economic activity that competes commercially. It usually takes an average of two weeks for a business to be fully registered, this can vary in special cases, so its important to take this into account when designing your business plan. VAT in Spain - ScriptCrawler.net The Spanish tax authorities may require some of these documents to be translated into Spanish. Corporate income tax in Spain is 25%. Legal, business, and accounting solutions in Spain. The VAT number in Spain is an essential part of doing successful business within the Spanish Market. Requesting the Spanish NIF number is necessary to get a NIF-VAT number. With a population of almost 50 million, the Spanish market is lucrative and has strong purchasing power. If you store your goods in Spain, you also have to register for VAT in Spain. Where can you find a companys VAT number in Spain? All you need to do is present your credit card and send the Tax Free form to Customs within 21 days. This includes staple food items such as cheese, milk, beans, fruit and vegetables. This means that in general, you have to pay less VAT when importing goods from other countries to the canary islands. Every month: If you have generated more than EUR 6,000,000 in sales in the past year. But opting out of some of these cookies may affect your browsing experience. You can register your company easily with our services for company formation in Spain. Spain sets the level of its VAT rates. Originally, the Spanish VAT number was known as "Cdigo de Identificacin Fiscal". That is because they have a special type of sales tax, called IGIC (Impuesto General Indirecto Canario), and do not use VAT. There are some rules about when you need a Spanish VAT registration. That operation would be exempt from VAT. Topics that we will discuss are VAT registration, the Spanish tax system, NIF number, VAT purposes, VAT return, and the purposes of the Spanish VAT. If you are looking to open a business bank account in Spain, it is smart to go with a popular bank for foreign companies in Spain. These cookies do not store any personal information. The first is the exceeding of the Spanish delivery threshold, the second is the temporary storage of goods in Spain. In all your invoices, you will have to add an extra 21% as VAT for all the services provided. Domestic enterprises, on the other hand, replace the letter following the country code with a number, yielding ES12345678X as the consequence of the substitution. Citizens and residents in Spain have a NIF number, which functions as a VAT number. Keeping track of your invoices is important because you will need to deduct the VAT that you pay on your purchases and add the VAT of your sales. Vatican City. Keep the invoices you sent to your customers. The tax also has two advance payments during the first six months of the companys tax year and the second before the end of the year. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); Based in Barcelona, with over 40 years of professional experience, Balcells Group Lawyers provides expert legal advice and services specialised in the areas of Immigration, Tax, Business and Legal, Rambla de Catalunya, 124, 1-208008 Barcelona (Spain)+34 936 31 51 39, Monday Thursday | 9:00 18:00Friday | 9:00 17:00, Services|News|Contact| About |Legal Notice | Privacy Policy | Cookie Policy, document.write(new Date().getFullYear()); Balcells Group | All Rights Reserved | Site by INZONE, One of the taxes you will most frequently pay in Spain is the, VAT when buying products to other EU countries, Sales tax if you are providing services in Spain as a freelance, Entertainment and leisure options (like the theater, cinema, amusement parks, or concerts). By choosing I Accept, you consent to our use of cookies and other tracking technologies. Spanish authorities will sometimes audit businesses. Currently, the general sales tax or VAT rate is 21%. Indirect tax - Spain | Grant Thornton We pride ourselves of being a one-stop solution for your legal and tax challenges in Spain. But what happens if a professional from Lanzarote, for example, does business with mainland Spain? You can use the Tax Free management access point, which is located at your location of departure. You can go to one of their offices or kiosks found across Madrid, Girona, Lloret de Mar, Valencia, Puerto Banus and Barcelona. If youre planning on visiting any of these countries, have a look at their rules for tax-free shopping. General rate IVA - 21%. Tasas y otros Ingresos (TIO): A TIO sales tax is applied when applying for business, vehicle or health certificates. A business is required to acquire a Spanish VAT registration and businesses in Spain are also required to submit periodic returns with all the information regarding their taxable products. Spain - Individual - Other taxes - Worldwide Tax Summaries Online Only deliveries of products or services mentioned in Annex III of the VAT Directive may be subject to one or two reduced rates [not below 5%]. ESX1234567X is created by adding a letter, seven digits, and then another letter to the end of the number, giving the result: ESX1234567X. VAT is called IVA in Spain, short for impuesto sobre el valor aadido. For the second reduced VAT rate (4%), divide the original price by 1.04. Not knowing the system is not an excuse and a bad decision made in ignorance can lead to higher taxes in the future or even fines and penalties. There are a number of authorized partners that are authorized to refund VAT by the Tax Agency. The Spanish Tax Administration will assign you a NIF number after checking that your business is registered, has an address, deeds of incorporation, bylaws, and a variety of other formalities. Next to taking care of the company formation in Spain, our tax advisors can help you with your VAT declaration. VAT rates application in Spain. VAT refund calculator for business travel in Spain | TravelPerk Businesses that charge admission fees for live events or exhibitions in Spain must register for VAT. The two reduced VAT rates are 10% and 4%. One of the taxes you will most frequently pay in Spain is the sales tax, called VAT (or IVA in Spanish). If the total amount of goods or services is more than 6 million annually, you will have to file VAT monthly. It is important for any business dealing in the supply of goods and services in Spain to check whether their products are taxable.An easy way to know if your products are tax exempt is that only gold coins, ingots, gold bars and international air or sea travel are exempt for VAT at a rate of 0%. This is called the Spanish Intrastat. In Spain, there is a sales tax that is called "IVA" or VAT (in Spanish "Impuesto sobre el Valor Aadido), a tax applied on retail sales or services provided by professionals. If companies with sales to other EU countries reach the annual turnover threshold of EUR 10,000, they will be liable for VAT in all countries they are selling to. It is a tax on consumption which is applied on supplies of goods or services, intra-community acquisitions and imports. But opting out of some of these cookies may affect your browsing experience. Spanish VAT is also sometimes called impuesto al valor agregado, impuesto sobre el valor menorado y el valor aadido, and impuesto sobre el valor aadido. Not only the delivery threshold is a reason to register for the Spanish VAT number. You can get this with the help of a local representative who will apply for it for you. The 4% reduced tax rate is applied to select foods, medical and pharmaceutical products, newspapers and periodicals, social housing and services, domestic care services and constructions.The 0% reduced tax rate is applied to gold coins, ingots and bars and internal and international air or sea travel.
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