Skip to main content
Practical Handbook VAT 2021

General rule

Supplies of services will be taxed by the Spanish VAT according to the following criteria:

  1. When the recipient is a trader or professional and has his place of business, permanent establishment, domicile or habitual residence in the territory where the tax is levied, provided that the services are provided to the said place of business, permanent establishment, domicile or habitual residence, irrespective of where the supplier of the services is established and the place from which he provides them.

  2. When the recipient is not a trader or professional, provided that the services are provided by a trader or professional and the seat of his economic activity or permanent establishment from which he provides them or the place of his domicile or habitual residence is in the territory where the tax applies.

By way of exception, the following services are not subject to Spanish VAT when the recipient is a private individual and is established or has his permanent address or habitual residence outside the Community, unless he is established or has his permanent address or habitual residence in the Canary Islands, Ceuta or Melilla:

  1. Assignments and grants of copyrights, patents, licences, trademarks and other intellectual or industrial property rights, as well as any other similar rights.

  2. The assignment or granting of goodwill, exclusive purchase or sale rights or the right to exercise a professional activity.

  3. Advertising.

  4. Consultancy, auditing, engineering, research, law, consultancy, accounting or tax experts and other similar services, with the exception of those included in number 1 of section 1 of Article 70 of this Law.

  5. Data processing and the provision of information, including commercial procedures and experiences.

  6. Translation, proofreading or typesetting services, as well as services provided by interpreters.

  7. Insurance, reinsurance and capitalisation, as well as the financial services referred to in Article 20(1)(16) and (18) respectively of this Law, including those that are not exempt, with the exception of the rental of safe deposit boxes.

  8. Staff secondments.

  9. Film dubbing.

  10. Leases of tangible movable tangible property, with the exception of leases of any means of transport and containers.

  11. the provision of access to natural gas networks within the territory of the Community or to any network connected to such networks, to the electricity and heating or cooling networks, and of transmission or distribution through such networks, as well as the provision of other services directly linked to any of the services referred to in this point.

  12. Obligations not to provide, in whole or in part, any of the services set out in this number.

The seat of economic activity:

It shall be located in the territory where the entrepreneur or professional centralises the management and habitual exercise of his activity.

For the purpose of determining the place of performance of services, the place where the central administration functions of the undertaking are exercised shall be the place where the economic activity of the undertaking is carried out.In determining this, account shall be taken of the place where fundamental decisions relating to the general management of the company are taken, the registered office and the place where the management meets.Where these criteria do not make it possible to determine with certainty the place where the seat of the economic activity is located, the prevailing criterion is the place where the fundamental decisions relating to the general management of the company are taken.

A mere postal address cannot be considered as the seat of economic activity.

Permanent establishment:

A permanent establishment is considered to be any fixed place of business where entrepreneurs or professionals carry out economic activities.In particular, the following shall be regarded as such: head offices, branches, offices, mines, quarries, certain construction, installation or assembly work, agricultural, forestry or livestock holdings, immovable property held under lease or otherwise, etc.

For the purposes of determining the place of supply of services, a fixed establishment means any establishment, other than the place where the economic activity is carried out, which is characterised by a sufficient degree of permanence and an adequate structure in terms of human and technical resources to enable it to receive and use the services supplied to it for its own needs or to enable it to supply the services it provides.

The fact of having a VAT TIN is not sufficient as such to consider a taxable person as having a permanent establishment in the State which has allocated the VAT TIN .