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VAT practical manual 2022.

Deliveries of goods and provision of services

The Law establishes two fundamental rules:

  • The tax accrues when the operation is carried out.

  • When there are advance payments prior to carrying out the operation, the tax accrues at the time of total or partial collection of the price for the amounts actually received (except for exempt deliveries due to being destined for another Member State).

Example:

The exchange of plots for floors of the buildings that are built on them gives rise to the accrual of VAT corresponding to the future delivery of the floors for the advance payment that the delivery of the plot entails.

The amounts retained by the recipient of the work as a guarantee of the correct execution of the work are not considered to have been effectively collected.

To determine the moment in which the taxable event is deemed to have been carried out, the Law distinguishes the different operations:

  1. Deliveries of goods: when they are made available to the acquirer or, where appropriate, when they are carried out in accordance with the legislation that applies to them.

    The fact that the collection occurs later is irrelevant. Therefore, in installment sales, the tax is accrued in full when the delivered goods are made available to the purchaser, even if the installments are met later.

    When there is a public deed granted, the making available is understood to have been carried out, by legal provision, at the time of its granting. However, if a different time for making the thing available is deduced from the deed, the accrual will occur when the making available takes place.

    In deliveries of goods made without transfer of ownership (sale contracts with retention of title agreement or other suspensive condition, lease-sale of goods or lease of goods with a transfer of ownership clause binding on both parties). ), the accrual occurs when the goods are placed in the possession of the purchaser.

  2. Provision of services: when the taxable operations are provided, executed or carried out, except in the case of continued operations described in the second paragraph of article 75.One.2 of the LIVA .

    Example:

    The VAT of the services provided by lawyers and solicitors in the course of a judicial procedure is accrued when the performance of the service is completed, that is, when the procedure is concluded (except for advance payments).

  3. In executions of work with the contribution of materials, the accrual occurs at the time the goods to which they refer are made available to the owner of the work.

  4. In executions of work with or without contribution of materials , whose recipients are the public Administrations, at the time of receipt.

    Example:

    Businessman who carries out two executions of work with the contribution of material, one for another businessman and the other for a public Administration:

    • When the recipient is another businessman, the accrual occurs at the time the work is made available to its owner.

    • When the recipient is a public Administration, the accrual occurs at the time the work is received and not at the time the work is made available to its owner. All this without prejudice to the fact that, if there have been advance payments, the VAT is accrued at the time of collection thereof and on its amount.

  5. Transfers of goods between principal and commission agent carried out under sales or purchase commission contracts when the commission agent acts in his own name:

    • In sales commissions: The VAT corresponding to the delivery from the principal to the commission agent is accrued when the commission agent delivers the goods to the client.

    • In the purchase commissions: The VAT corresponding to the delivery from the commission agent to the principal is accrued when the supplier delivers the goods to the commission agent.

  6. In the case of deliveries of goods made pursuant to contracts by which one of the parties delivers movable property to the other, whose value is estimated at a certain amount, with the recipient being obliged to procure its sale within a period and to return the estimated value of the goods sold and the rest of the unsold goods, the accrual of the deliveries of the goods sold will occur when the person receiving them makes them available to the purchaser.

  7. In the cases of self-consumption, when the taxable operations are carried out.

  8. In leases, in supplies and, in general, in successive or continued operations, at the time when the part of the price that comprises each payment becomes payable.

    Examples:

    Gas supply, electricity supply, leases.

    In leases, non-payment of rent does not prevent it from continuing to be obligatory to pay the tax, because the tax will continue to accrue each time payment of the rent is due.

    However, when the price or has not been agreed, the moment of its enforceability has not been determined, or the enforceability is greater than one calendar year , the accrual will occur on December 31 of each year for the proportional part corresponding to the period elapsed since the beginning of the operation, or since the previous accrual, until the aforementioned date.

    Example:

    In the case of a lease of premises in which it is stipulated that the rent will be paid at the end of the lease and it has a duration of 4 years, the accrual will occur on December 31 of each year, not the 4 years.

    When the supplies constitute exempt intra-community deliveries of goods (article 25.One of the LIVA ) or exempt transfers of tangible assets of a company destined for another Member State, to affect the needs of the company in this State (article 25.Three of the LIVA), if the price has not been agreed, or the moment has not been determined of the enforceability or this has been established with a frequency greater than the calendar month, the accrual of the Tax will occur on the last day of each month for the proportional part corresponding to the period elapsed from the beginning of the operation, or from the previous accrual, until the aforementioned date.

  9. In the intra-community deliveries of exempt goods, other than those in letter h) above, the accrual will occur on the 15th day of the month following that:

    • On which the dispatch or transportation of the goods to the purchaser begins, or on the date of issue of the invoice if earlier.

    • At the time the goods are made available to the purchaser in the deliveries of goods within the framework of an agreement for the sale of goods on consignment or on the date of issuance of the invoice for said operations if earlier.

    • At the time when non-compliance with the conditions referred to in section three of article 9 bis of the LIVA occurs.

    • On the day following the expiration of the period of 12 months from the arrival of the goods in the Member State of destination without any trader having acquired them within the framework of an agreement for the sale of goods on consignment. (Modification introduced by article 214 of Royal Decree-Law 3/2020, of February 4 ( BOE of 5), applicable from March 1, 2020).

  10. In the deliveries of goods made in the terms provided for in article 8 bis of the LIVA , the accrual of the tax on the delivery made in favor of the businessman or professional who facilitates the sale or delivery, as well as the one carried out by him, will occur with the acceptance of the client's payment.

  11. In the operations of leasing, the accrual occurs:

    • Before there is a commitment to exercise the purchase option, the operation is considered a leasing service and the tax accrues as each perception becomes payable.

    • When there is a commitment to exercise the option, the operation is considered a delivery of goods and the tax is accrued for the amount that remains pending payment.