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VAT TAX IN SPAIN

IVA is an indirect tax that fall upon consume and the consumer and taxes the purchase of goods, services provided by companies or professionals and the import of assets and services.

The IVA applicable area is limited to Spanish peninsular territory and the Balearic islands. The Canary Islands, Ceuta and Melilla are are excluded.

Spanish VAT percentage

Spanish VAT percentatges have changed since the 01st of September 2012, and are the following:

- General: 21%  (this is applied with general character)

- Reduced: 10% y 4%

The 10% is applied to determined services and products, for example:  products subject to human and animal nutritional use, water, products related to health, sports, public transport and catering trade, amongst others. 

The 4% is applied to the following products: determined food such as bread, flour, cheese, eggs, fruit, vegetables….., to books, newspapers and magazines, and to medicine, amongst others

Special IVA Tax regimes in Spain

There are other special regimes different to the general regime, such as: 

  • Simplified regime.
  • Used goods special regime, Works of art, antiques and collectable objects.
  • Travel agency special regime
  • Equivalence special regime (minority commerce)   
  • Special regime applicable to investment operations with gold 
  • Special regime applicable to services provided electronically.   
  • Special regime for groups of entities

Operations exempt from VAT tax in Spain:

There are determined operations that are exempt from IVA, such as: sanitary assistance services, medicines, veterinarian services, services provided by professional doctors, education, learning classes, insurance financial services and determined banking operations. 

“CENSO VIES” for European Union Operations

For Spanish companies to be able to put in to effect operations with other European Union countries, they will need to register at “CENSO  VIES” registry, from here companies can apply for an intercommunity CIF number. This CIF number will be the same one the company already has but with the difference of having added the corresponding Country’s acronym at the front. In Spain ES is added at the front of the  CIF number.

All companies that carry out intercommunity operations that are registered with the this particular registry are exempt from reflecting IVA on their invoices as long as the client is also registered at “CENSO  VIES”

To check if a company is registered or not the registry can be acceded though the “Agencia Tributaria” (Spanish tax office) website.

SPANISH IVA DECLARATIONS

IVA is presented every three months by presenting the form “modelo 303”. Spanish companies are obliged to present declarations by electronic data transmission though the “Agencia Tributaria” (Spanish tax office) website.

Presentation time frames for IVA TAX in Spain

  • 1st trimester: from the 01st to the 20th of April
  • 2nd trimester:  from the 01st to the 20th of July
  • 3rd trimester: from the 01st to the 20th  of October
  • 4th trimester:  from the 01st to the 30th of January of the following year

Calculation method:

Declarations state the IVA reflected on invoiced issued and IVA paid on invoices received is deducted. This sets out two possibilities:

  1. If the difference is positive: this amount is paid to the  “Agencia tributaria” (Spanish tax office)  via the company current account.
  2. If the difference is negative, this amount can be compensated with the IVA payable in future declarations or the
  • reimbursement can be applied for in the following manners:

2.a. ANNUAL Reimbursement

If at the end of the year, in the 4th trimester declaration there is a negative result in favour of the company, the company can apply for the reimbursement via the “Agencia tributaria” (Spanish tax office) by duly presenting the form “modelo 303”. The administration usually proceeds to put this reimbursement in to effect within the following 6 months, approximately.

2.b. Monthly Reimbursement

There is a possibility of applying for the monthly reimbursement of IVA, the most regular are

Export companies that do not reflect IVA on their invoices due to the export of goods being exempt of IVA

For the rest of passive subjects registered at the monthly reimbursement registry.

VAT Tax Annual informative declaration

Is a resumed declaration of the annual IVA and is of an informative character. The form “modelo 390” must be used and contain the total of operations carried out in the natural year. The presentation time frame is from the  01st to the 30th of January and is presented along with the 4th trimester.

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