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VAT practical manual 2022.

Non-application of the special system

The special regime for agriculture, livestock and fishing will not apply:

  1. To those who are not owners of these holdings , as seen in the previous section « Requirements ».

  2. Excluded activities. The special regime cannot be applied to the following activities:

    1. When natural products are transformed, processed or manufactured.

      Acts of mere conservation such as: pasteurization, freezing, drying, cleaning, hulling, chopping, disinfection, etc.; nor the obtaining of agricultural raw materials that do not require the slaughter of livestock.

    2. When the products obtained are sold mixed with others acquired from third parties, unless they are merely preservatives.

    3. When the products are sold in fixed establishments located outside the farms or in establishments in which the taxable person also carries out other economic activities.

    4. Recreational or sporting hunting operations.

    5. Sea fishing.

    6. Independent livestock farming.

    7. Provision of accessory services not included in the regime.

      Activities excluded from this regime (such as independent livestock farming; breeding, keeping and fattening livestock; excluded accessory services) can be taxed in the simplified regime.

  3. Excluded taxable persons. They cannot apply this regime:

    1. Trading companies.

    2. Cooperative companies and agricultural trading companies.

    3. Those who have carried out operations related to the activities included in this regime the previous year for an amount greater than 250,000 euros and those who exceed, for all operations other than those included in this regime during the previous year, 250,000 euros.

      The determination of the volume of operations will be carried out according to the following rules:

      • In operations subject to the special regime for agriculture, livestock and fishing and the simplified regime for all agricultural, forestry and livestock activities that are determined, only those that must be recorded in the record books will be counted.

      • In operations subject to other special regimes or the general regime, they will be computed according to the provisions of article 121 of the VAT Law . Real estate leasing operations whose execution involves the development of an economic activity will not be counted in Personal Income Tax .

    4. Entrepreneurs or professionals who have renounced the application of the objective estimation regime of the Personal Income Tax for any of their economic activities.

    5. Businesses or professionals that have waived the application of the simplified regime.

    6. Those businessmen or professionals whose purchases and imports of goods and services for all their business or professional activities have exceeded 250,000 euros annually in the previous year, VAT excluded (the acquisitions of fixed assets).

  4. Resignation to the special regime.

    The practice of deductions from fees borne or paid before the start of the usual delivery of goods or services is equivalent to waiver.

    In general, the resignation must be made through the corresponding census declaration (form 036 or 037), it is valid for a minimum of three years and will be understood to be extended for each of the following years in which the regime could be applicable, unless expressly revoked in the month of December prior to the beginning of the calendar year in which it must take effect.

    The resignation is understood to have been made with the timely presentation of the self-assessment corresponding to the first quarter of the calendar year in which it must take effect or of the first declaration that must be submitted after the beginning of the activity applying the general regime.