VAT Spain Guide

Planning a business expansion into Spain? Then you probably know that includes, in most cases, registering for VAT in Spain. It can be a complicated process, though, particularly for the uninitiated. Read on to learn more about Spanish VAT rules and how they affect your business activity in Spain.

What is the VAT rate in Spain?

VAT in Spain is known as Impuesto sobre elValor Añadido (IVA). If your business meets certain criteria you will be required to obtain a Spanish VAT number and declare and pay VAT locally. There is a standard Spanish VAT rate of 21%, two reduced rates of 10% and 4%, and also a zero VAT rate.

When must you register for VAT in Spain?

There is no domestic VAT registration threshold in Spain, meaning both resident and non-resident businesses must register as soon as they carry out taxable activities.

You must register if:

• You make in-country taxable supplies of goods or services.
• You store inventory in Spain for sale (including through Amazon FBA).
• You carry out intra-community acquisitions or dispatches of goods in/from Spain.
• You exceed the €10,000 EU-wide distance selling threshold and do not opt into the OSS (One Stop Shop) scheme.
• You install or assemble goods in Spain.
• You provide B2C digital services to Spanish customers (if not using the non-Union OSS).

Registration process:

• Applications are submitted to the Administración de la Agencia Estatal de AdministraciónTributaria (AEAT).
• You’ll receive a Spanish VAT number (NIF-IVA) upon approval.
• The process can take 2–4 weeks, and additional documentation may be requested.‍

Required documents:

To register for VAT, businesses generally need to provide:

• Completed VAT registration form (Form 036)
• Articles of association and proof of business incorporation
• Passport or ID of legal representatives
• Proof of business activity (e.g., contracts, invoices)
• Proof of establishment (for resident entities)
• Appointment of a fiscal representative (non-EU businesses)

Voluntary registration is also permitted, for example, if you want to recover Spanish input VAT.

Fiscal representation in Spain

If your business is based outside the EU, you are legally required to appoint a fiscal representative in Spain. This representative:

• Acts as your liaison with Spanish tax authorities
• Files VAT returns and handles correspondence
• Shares joint liability for any VAT debts

Note: EU-based companies are exempt from this requirement but may still appoint a local representative for administrative ease.

Spanish VAT return filing

Your company’s annual sales amount will determine how frequently you file a Spanish VAT return. VAT returns must be filed electronically.

• Submit a monthly return if your annual sales totaled more than €6 million.
• Submit a quarterly return If your annual sales were less than €6 million.
• All VAT-registered businesses are also required to file annual VAT returns.

Spanish VAT returns must be submitted by the 20th of the month following your accounting period. The deadline for submitting annual VAT returns is January 30th of the following year.

Penalties for late filing or payment

Spain enforces strict VAT compliance. Late submission or payment may lead to:

• 1% monthly surcharge on unpaid VAT, increasing up to 12%
• Additional penalties for non-filing or fraud
• Interest charges of 5%, 10%, or 20% depending on the delay
• Suspension of your Spanish VAT number in severe cases

Spanish Intrastat declarations

Intrastat returns are required for goods moving between Spain and other EU countries. This applies to both Spanish and non-resident companies once thresholds are reached.

The annual threshold for filing a standard Intrastat return is €400,000 (arrivals/dispatches) and €6,000,000 for a detailed Intrastat return (arrivals/dispatches).

Deadline: Submit by the 12th of the month following the transaction. Late submissions may incur fines.

Reverse charge in Spain

In certain transactions, VAT is not charged by the supplier but is instead self-assessed by the recipient. This applies to:

• B2B cross-border services under general EU rules
• Domestic supplies in construction, waste, scrap metal, and gas/electricity sectors
• Some intra-EU acquisitions of goods

Under reverse charge, the recipient accounts for both input and output VAT on the same return. This mechanism helps reduce the VAT compliance burden for foreign suppliers who may not need to register.

IGIC Tax in the Canary Islands

The Canary Islands operate a distinct tax regime separate from Spanish VAT, known as IGIC (Impuesto General Indirecto Canario). IGIC is applied to the supply of goods and services within the Canary Islands and imports into the region.

IGIC rates:

Standard rate - 7% (General goods and services)

reduced rates - 0%, 3% (Basic foods, books, medicines)

Increased rates - 9.5%, 15% (Tobacco, alcohol, luxury goods)

Who needs to register for IGIC?

• Businesses established or carrying out taxable transactions in the Canary Islands
• Non-resident businesses selling into or operating in the region
• Registration is with the Agencia Tributaria Canaria

IGIC filing requirements

• Quarterly returns for most businesses
• Monthly filing may apply to large taxpayers
• Filing and payment deadlines mirror Spanish VAT but use the regional portal

Differences between VAT and IGIC

‍While IGIC functions similarly to VAT, it is managed independently and applies only within the Canary Islands. Businesses operating in both mainland Spain and the Canary Islands must ensure compliance with both VAT and IGIC regulations.

How Taxually can help with Spanish VAT compliance

Navigating Spain’s VAT system can be challenging—especially if you’re operating across multiple jurisdictions. Taxually’s VAT compliance software simplifies the entire process:

• Local and EU VAT registration support
• Automated VAT return generation and filing
• Fiscal representation for non-EU businesses
• Real-time monitoring of thresholds and reporting deadlines

Need support? Get in touch to speak with a VAT expert today.