New regulations for 2020

Main tax measures regarding VAT included in Royal Decree-Law 3/2020 of February 4 on urgent measures by which various directives of the European Union in the field of public procurement in certain sectors are incorporated into the Spanish legal system; of private insurance; of pension plans and funds; in the field of taxation and tax litigation

MODIFICATION OF THE VALUE ADDED TAX LAW

Article 214 of Royal Decree-Law 3/2020 introduces the following modifications to Law , of December 28, on Value Added Tax (LIVA) :

A) INTRA-COMMUNITY TRADE – “QUICK FIXES”

In order to incorporate Council Directive (EU) 2018/1910, of December 4, 2018, into our internal regulations, the following modifications are established:

• Sale of reserve stocks or sales on consignment (art. 9.3, 9 bis, 15, 75.Uno.8 LIVA)

  As of March 1, 2020 , the application of the exemption on transfers of “call-off stock” of the so-called “consignment sales agreements” is simplified.

  These are agreements concluded between entrepreneurs or professionals for the cross-border sale of goods, in which a businessman (supplier) sends goods from one Member State to another, within the European Union, so that they are stored in the Member State of destination at the disposal of another businessman or professional (customer), who can acquire them at a later time after their arrival.

  Currently, this operation gives rise to a transfer of goods or an operation similar to an intra-Community supply of goods in the Member State of departure and an operation similar to an intra-Community acquisition of goods in the Member State of arrival, carried out in both cases by the supplier. Subsequently, when the customer acquires the goods, the supplier will make an domestic delivery in the Member State of arrival in which the reverse charge rule will apply, corresponding to such condition to its customer. The supplier is required to be identified for VAT purposes in the Member State of destination of the goods.

  In order to simplify these operations and reduce the administrative burdens on entrepreneurs, the new regulation establishes that deliveries of goods made within the framework of a consignment sales agreement will give rise to a single operation: an intra-Community supply of goods exempt in the Member State of departure carried out by the supplier, and an intra-Community acquisition in the Member State of arrival carried out by the customer when withdrawing the goods from the warehouse. Specifically, the accrual of the transaction will occur on the 15th of the month following the month in which the goods are made available to the purchaser, or on the date on which the corresponding invoice is issued if it is earlier.

  In any case, entrepreneurs or professionals may choose not to benefit from the simplification by failing to comply with the conditions provided for its application, which are the following:

  • The seller does not have the headquarters of his economic activity or a permanent establishment in the Member State of arrival.
  • The entrepreneur who is going to acquire the goods has a VAT identification number (N-VAT) in the Member State of arrival.
  • The seller must know the tax identification number (N-VAT), name and surname, full name or corporate name of the purchaser at the time of the start of transport.
  • The goods are transported to the Member State specified in the consignment sales agreement.
  • The seller has included the shipment of the goods in the Register of certain intra-community operations and in form 349.
  • Within 12 months of the arrival of the goods in the Member State of destination, one of the following situations must have occurred:
    1. The goods are purchased by the entrepreneur indicated in the consignment sales agreement.
    2. The goods are acquired by a business person who replaces the initial recipient when he has a tax identification number (N-VAT) in the Member State of arrival and the seller includes the replacement in the Register of certain intra-Community operations and in Form 349.
    3. The goods are returned to the territory of application of Spanish VAT without the power of disposal having been transferred and the seller includes such return in the Record Book of certain intra-community operations.

  A transfer of goods (art. 9.3 LIVA) will be deemed to have occurred when, within the period of twelve months any of the conditions indicated above are breached, in particular:

  • When the goods have not been acquired by the businessperson or professional to whom they were initially intended.
  • When the goods are dispatched or transported to a destination other than the Member State specified in the agreement for the sale of goods on consignment.
  • In the event of destruction, loss or theft of goods.
• Chain operations. (art. 68.Two.1 LIVA)

  As of March 1, 2020 , the LIVA incorporates the harmonization of the taxation of “ chain operations ”.

  This type of operation is carried out when the same goods, which are to be sent or transported to another Member State directly from the first supplier to the final purchaser in the chain, are the subject of successive deliveries between different businessmen or professionals. Thus, the goods will be delivered to at least one first intermediary who, in turn, will deliver them to other intermediaries or to the final customer in the chain, there is only one intra-community transport.

  In order to avoid different interpretations between Member States, prevent double taxation or non-taxation and strengthen legal certainty for operators, transport shall be understood as linked:

  • The delivery of goods made by the supplier in favor of the intermediary , which will constitute an exempt intra-community delivery of goods. To do so, the intermediary must have communicated a tax identification number provided by a Member State other than Spain.
  • Upon delivery made by the intermediary when he has communicated to his supplier a VAT NIF provided by the Kingdom of Spain. The delivery from the supplier to the intermediary will constitute an internal delivery subject to and not exempt from VAT and the delivery made by the intermediary to his client will be an exempt intra-community delivery.
• Exemptions in intra-Community supplies of goods. (art. 25.One and Four, 84.One.2.c', 164.One.5 LIVA)

  With effect from 1 March 2020, the requirements for applying the exemption for intra-Community supplies of goods are modified in order to strengthen the fight against fraud in this type of operation.

  To this end, in order to apply the exemption, in addition to the requirement of transporting the goods to another Member State, as material and non formal condition, it will be necessary that:

  • The purchaser has communicated to the supplier a VAT identification number ( N-VAT ) allocated by a Member State other than the Kingdom of Spain.
  • The supplier has included the operation in the summary declaration of intra-community operations ( model 349 ).

B) SCOPE OF TERRITORIAL APPLICATION OF VAT (art. 3.Two.1, a) and b) LIVA)

As of February 6, 2020 , based on Council Directive (EU) 2019/475 of February 18, 2019, the Italian municipality Campione d 'Italy and the Italian waters of Lake Lugano become part of the customs territory of the Union and the scope of application of Council Directive 2008/118/EC, for the purposes of Excise Duties, but remain outside the scope of territorial application of VAT.

MODIFICATION OF THE VALUE ADDED TAX REGULATIONS

Article 216 of RD-Law 3/2020 introduces the following modifications in Royal Decree 1624/1992, of December 29, which approves the Value Added Tax Regulation (RIVA), in order to adapt our internal regulations to Council Directive (EU) 2018/1910, of December 4, 2018 and Council Implementing Regulation (EU) 2018/1912, of December 4, 2018 :

• Sale of reserve stock or consignment sales: Registration book and model 349 (art. 66.1.3, 66.2 and 3, 79, 80.1.4, 80.2, 80.3, DT sole RIVA)

  Implementing Regulation (EU) 2018/1912 determines the information that must be included in the 'reserve stock' (call-off stock) record books, substantive requirement for the consideration of the transfer of goods to another Member State and subsequent internal delivery as a single intra-Community operation. On the other hand, the VAT Directive establishes the obligation for the seller who dispatches goods to another Member State within the framework of an agreement for the sale of goods on consignment to present the recapitulative declaration of intra-Community operations.

  Consequently, with effect from March 1, 2020, the RIVA is modified to:

  1 Include among those required to submit the summary declaration of intra-community operations ( model 349 ) those businessmen or professionals who send goods to another Member State within the framework of consignment sales agreements, who must indicate:

  • The identification number for VAT purposes of the businessman or professional to whom the goods are intended, as well as the estimated initial amount of their value, in the declaration period relative to the date of dispatch.
  • The identification number for VAT purposes of the businessman or professional who replaces the initial recipient of the goods, in the event of such substitution, in the declaration period in which it was recorded in the Record Book of certain intra-Community operations.

  2 Regulate how to record these operations within the Record book of certain intra-community operations.

  1. The seller must provide the following information:
     • The Member State from which the goods have been transported and the date of dispatch.
     • The VAT identification number of the businessman or professional for whom the goods are intended, assigned by the Member State to which they are transported.
     • The Member State to which the goods are transported, the VAT identification number of the warehouse of the goods if different from the recipient, the address of the warehouse and the date of arrival at the warehouse.
     • The value, description and quantity of the goods that have arrived at the warehouse.
     • The VAT identification number of the businessman replacing the initial recipient of the goods.
     • Description, tax base, quantity and unit price of the goods delivered, delivery date and identification number for VAT purposes of the acquiring businessman.
     • Description, tax base, quantity and unit price of the goods whose movement gives rise to a transfer due to non-compliance with the requirements for consignment sales, date on which the circumstances occurred and reason.
     • Description, quantity and value of the goods that, if applicable, have been returned and date of return.
  2. The businessman to whom the goods are destined or his substitute must state the following data:
     • The seller's VAT identification number.
     • The description and quantity of the goods sent to be made available to you.
     • Description, taxable base, quantity and unit price of the goods acquired and date on which the intra-community acquisition is made.

     If you are in charge of the storage of the goods, you must also register:

     • The date of arrival of the goods at the warehouse.
     • Description and quantity of the goods that are withdrawn from the warehouse by the seller and are no longer at his disposal, as well as the date on which they are withdrawn.
     • Description and quantity of the goods destroyed or missing from the warehouse and the date on which such circumstance occurs or is discovered.

     For those entrepreneurs who apply the Immediate Supply of Information (SII) , the obligation to register consignment sales in the Registry Book of certain intra-community operations through the electronic headquarters of the AEAT is delayed until January 1, 2021.

• Exemptions for intra-Community supplies of goods: model 349.  (art. 81.4 and 81.5 RIVA)

  Directive (EU) 2018/1910 provides that the declaration of intra-community delivery in the summary declaration of intra-community operations (form 349) becomes a substantive requirement for the application of the exemption.

  In this regard, so that compliance with this requirement is closer in time to the date of operation, and taking into account its limited use by companies, the possibility of annual submission is eliminated with effect from March 1, 2020.

• Proof of intra-community transport. (art. 13.2, 13.3, 13.4.1 RIVA)

  As of January 1, 2020 , Implementing Regulation (EU) 2018/1912 in its article 45 bis establishes a harmonized system of presumptions, without prejudice to the fact that admit evidence to the contrary , which aims to simplify the proof of the requirements for the application of the exemption in intra-community deliveries.

  Therefore, the transport of the goods to the Member State of destination shall be justified by any means of proof admissible by law and, in particular, shall be proven by the following elements of proof:

  1. When the seller indicates that the goods have been transported by them or by a third party on their behalf and:

  1. is in possession of at least two of the following items of evidence (issued by independent parties from the seller and the purchaser):
     • Signed CMR letter or document
     • Bill of lading
     • Air freight invoice
     • Invoice from the carrier of the goods
  2. is in possession of one of the above-mentioned evidence together with any of the following evidence (issued by independent parties from the seller and the purchaser):
     • Insurance policy relating to the transportation of goods or bank documents proving payment for the same.
     • Official documents issued by a public authority, such as a notary, certifying the arrival of the goods in the Member State of destination.
     • Receipt issued by a depositary in the Member State of destination confirming the storage of the goods in that Member State.

  2. When the seller is in possession of a written declaration from the purchaser certifying that the goods have been transported by him or by a third party on his behalf , mentioning the Member State of destination of the goods and:

  1. is in possession of at least two of the following items of evidence (issued by independent parties from the seller and the purchaser):
     • Signed CMR letter or document
     • Bill of lading
     • Air freight invoice
     • Invoice from the carrier of the goods
  2. is in possession of one of the above-mentioned evidence together with any of the following evidence (issued by independent parties from the seller and the purchaser):
     • Insurance policy relating to the transportation of goods or bank documents proving payment for the same.
     • Official documents issued by a public authority, such as a notary, certifying the arrival of the goods in the Member State of destination.
     • Receipt issued by a depositary in the Member State of destination confirming the storage of the goods in that Member State.

de medidas urgentes por el que se incorporan al ordenamiento jurídico español diversas directivas de la Unión Europea en el ámbito de la contratación pública en determinados sectores; de seguros privados; de planes y fondos de pensiones; del ámbito tributario y de litigios fiscales.(BOE, 05-febrero-2020)