The value added tax in Spain has both a standard rate and reduced rates that apply to the provision of certain goods and services. This indirect tax is imposed on goods that are sold and also on services that are provided in Spain. Companies need to register for VAT purposes at the local tax authorities in Spain and make sure that their business complies with the tax regulations in their business field.
VAT rates in Spain
The Spanish value added tax has a standard value of 21% for most goods and services but reduced rates of 10% and 4% also apply. The types of products or services for which the reduction is available are:
-10% (reduced VAT): foodstuffs (except for those with the super-reduced rate), passenger transport, certain plants, amateur sporting and events.
The video below offers more details on the Spanish value added tax:
The supply of goods and services in the insurance sector and the financial sector is exempt from VAT and so are goods and services offered in connection with health, education and rental purposes.
The normal 21% rate applies for all other products. VAT registration is mandatory for all companies that carry our transactions in Spain. International companies operating in the EU are required to obtain a special VIES identification number. Our company registration agents in Spain can help you register with the tax authorities.
Taxation in Spain
VAT returns in Spain must be filed periodically: the frequency is determined by the turnover. It can be monthly or quarterly. A VAT grouping regime allows companies to make aggregated VAT returns that includes the filings of more than one company in Spain.
Spanish companies also have other taxes to pay apart from the value added tax. The most important one is the corporate income tax.
Our experts can give you more information regarding the General Tax Law in Spain and how your company must observe it. We can also help you with professional accounting services and assistance for filing and payment.
Call us now at +34 914 547 020 or +34 933 443 365 to set up an appointment with our specialists in company formation in Madrid and Barcelona. Alternatively you can incorporate your company without traveling to Spain.
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I have had a very good collaboration with the specialists in company registration from CompanyFormationSpain.com. They answered to my requests rapidly and they managed to open a company in just a few days after I had sent all the required documents for my clients.
Cristian Darie, Partner of
Darie, Manea & Associates www.rolegal.com