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Practical Handbook VAT 2021

When you can deduct

The right to deduct arises:

  1. The general rule is that the right to deduct arises when the deductible amounts are accrued, provided that the supporting document of the transaction is available.

  2. As special rules the following are established:

    1. In the operations assimilated to imports whose declarations are submitted on time:at the end of the period to which the declarations refer, with the deductibility of the VAT quotas accrued for carrying out these operations in the form itself, as established in the 2nd paragraph of Article 73.3 of the VAT Regulations.

    2. At occasional deliveries of new means of transport: when the delivery is made.

    3. In the case of supplies of works of art, antiques and collectors' items to which the general tax system applies:where tax becomes chargeable on the supplies of such goods by the reseller.

    4. At special cash basis regime: at the time of full or partial payment of the price for the amounts actually paid or on 31 December of the year immediately following the year in which the transaction was carried out if payment has not been made.

    5. On the transactions carried out for the purpose of making the journey for the benefit of the traveller (Article 146 of the Law on VAT) which are intended to carry out a transaction to which the special scheme for travel agents does not apply (Article 147 of the Law on VAT):at the time when the tax corresponding to the transaction is accrued.

The right to deduct expires within 4 years of its creation.


A businessman locates two invoices he had misplaced, one for a service provided to him in 2014 and another for a purchase of goods received in 2018.

The service fee is not deductible because more than 4 years have passed since the service was provided.The tax paid on the acquisition of the goods can be deducted in the next self-assessment tax return because it has not been 4 years since the goods were placed at the disposal of the purchaser.

If the validity or amount of the deduction is pending the resolution of an administrative or jurisdictional dispute, the limitation period starts to run from the date on which the resolution or judgement becomes final.