Spanish VAT reverse charge
The reverse charge mechanism is designed to reduce the frequency with which companies trading across Europe must VAT register. It works across the EU. Spain uses the reverse charge system less than most other EU states.
It allows any transactions to be recorded through the VAT return of the customer, so alleviating the need for the foreign supplier to VAT register in Spain.
When is the Spanish VAT reverse charge used?
The reverse charge mechanism is applied in the following circumstances:
- Buying and selling goods in Spain if the original supplier and customer are Spanish VAT registered
- The supply of services to a Spanish VAT registered business (2010 VAT package).
- Supply of certain types of power.
- Other various minor goods.
What is the tax point for the Spanish reverse charge?
The tax point (when the VAT is due) for the reverse charge is the end of the month following the month of supply. However, if the vendor raised an invoice prior to the supply, then it is that date which should be used.
Other resources
This guide covers the essential steps ecommerce sellers need to take now that the UK has left the EU Customs Union and VAT regime to keep their cross-border sales going, avoid extra tax costs and frustrated customers.
Read the report to learn about key industry trends, emerging issues, and challenges faced by cross-border sellers and shippers.
Manage international tax with cross-border solutions for VAT, HS code classification, trade restrictions, and more.
