Spain

VAT Basics

Spanish VAT Rates

Spain has opted for the reduced and super-reduced VAT rates on a number of items allowed by the VAT Directive (source: European Commission).

Super-reduced rate of 4% applies on certain foodstuff items, certain pharmaceutical products, books and certain newspaper and social services.

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Vat Tax Spain

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Spanish VAT Deduction limits

The right to deduct input VAT generally follows the rules on deduction of Corporate Tax. Expenses need to be incurred for business purposes. In practice, the below items are generally deducted at the following rates:

• Input VAT on hotel accommodation or restaurant meals is 100% deductible provided the invoice is issued to the company and the expense is incurred for business purposes.
• Input VAT on conferences, fairs and exhibitions is normally 100% deductible.
• Business gifts are 0% deductible unless for promotion samples or low value gifts (less than 200€ per year)
• Car rental, car repair and fuel expenses are 50% deductible where the expenses is connected to both, business and personal purposes. If wholly and entirely for business purposes, then VAT can be deducted at 100%.
• Taxi, train and other transport expenses are 100% deductible provided an invoice or simplified invoice is issued.
• Entertainment expenses are generally 0% deductible.

Deducting VAT before starting your activities is only allowed under certain conditions. The expenses incurred should be connected to the expected business, there should be a short period between the expense and the start of the business and all accounting and tax obligations must be met. Find official information here.

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Spanish statute of limitations

Input VAT should be claimed in a VAT return filed no later than the end of the fourth year following the year during which the deductible VAT fell due.

Regarding the obligation to pay VAT, the Spanish authorities have four years and 11 months to claim output VAT from the first quarter VAT return; four years and seven months for the second quarter; four years and four months for the third quarter and four years for the fourth quarter.

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Spanish tax point rules

The tax point is the time when VAT becomes due. VAT due should be distinguished from VAT payable. VAT is due when the tax point occurs. VAT is payable between the day after the end of the reporting period and the due date to submit and pay the VAT return.

In Spain, the following tax point rules apply:

• General rule: Tax point arises when the goods are placed at the disposal of the customer or when the services are completed. For services connected to a supply of goods, the same tax point rules as for the supply of goods apply. In general, an invoice must be issued when the tax point occurs.
• Prepayments or advanced payments create a tax point. In these cases, VAT is due when the prepayment is made.
• Intra-Community acquisitions: Tax point occurs when the goods are placed at the disposal of the customer. An invoice must be issued by the 16^th day of the following month.  In these cases, a prepayment would not bring the tax point forward. Also, tax point occurs at the issuance of the invoice, when the invoice documenting the supply is issued prior to the commencement of the dispatch/transport.
• Intra-Community supplies: The tax point is the 15^th day of the month following the dispatch of the goods or the date of the issuance of the invoice, whichever happens earlier. For example, if goods are dispatched the 12^nd of February and an invoice was not issued, the tax point is the 15^th of March.
• Import: Tax point occurs when the goods are imported according to the relevant import documents.

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VAT registrations and Simplications in Spain

Spanish VAT number

As a general rule, a foreign business must register for VAT in Spain as soon as a taxable supply is made. The following are some usual examples of taxable transactions:

• Domestic supply of goods not reverse charged: A supply of goods located in Spain to a Spanish customer where the supply is not subject to reverse charge requires a VAT registration of the supplier. However, when the supplier is not established, this scenario is very unlikely. See Reverse charge rules in Spain for more information.
• Domestic purchase of goods under the reverse charge: Where the customer is obliged to account for VAT under the reverse charge mechanism, this customer must register for VAT purposes in Spain. For example, where a non-registered business buys goods from a non-established supplier, the buyer must register for VAT.
• Supply of services not reverse charged: Foreign non-established businesses supplying services on which Spanish VAT is due must register for VAT. These services are rather exceptional, as the general B2B rule would apply or domestic reverse charge would apply.
• Export: Exporting goods to a non-EU country requires a VAT number before the export is made.
• Intra-Community acquisition: Acquiring goods from another Member State where all conditions for intra-Community movements are met requires the customer to register for VAT. A limited VAT registration may apply where subsequent sales fall under reverse charge mechanism.
• Intra-Community supply: Supplying goods to another Member State is also a taxable transaction that obliges the supplier to register for VAT.
• Distance sales: When applicable in case the Seller has not joined OSS. See the E-commerce manual for more information.

Voluntary registration is not possible in Spain. This is, companies cannot register if they have not made a taxable transaction. A backdated registration is possible. Penalties on late filing will apply, also late payment penalties would apply in case a VAT payment has been missed. There is no registration threshold in Spain. This applies to both, established and non-established businesses. Any company performing taxable transactions should register for VAT.

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Limited VAT registrations

Also, companies making only imports, or imports followed by domestic sales under reverse charge in Spain are subject to a limited registration in Spain. This is, these companies must apply for a tax identification number, but no VAT returns must be submitted, and import VAT must be recovered via the correspondent VAT refund procedure for foreign companies. The same light registration scheme applies to companies making intra-Community acquisitions of goods followed by domestic sales under reverse charge. In this case, only ESPL returns are due, as well as Intrastat if the threshold is exceeded.

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Global VAT numbers in Spain

Global VAT numbers, also known as freight forward VAT numbers or limited fiscal representation, are not allowed in Spain.

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Spanish VAT number Format

• Country code: ES
• Structure: ESX9999999X
• Format (excludes 2 letter alpha prefix): 1 block of 9 characters

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Fiscal representative in Spain (requirements)

Non-EU businesses must appoint a Spanish fiscal representative when registering for VAT purposes in Spain. Unlike other EU countries, the fiscal representative is not jointly and severally liable for the tax debts of the company. EU businesses can register directly for VAT purposes. This means that the legal representative of the company can sign the registration form without any local Spanish involvement. However, in practice this may be difficult as the authorities often require the registration form to be signed by someone with a Spanish ID. Alternatively, the legal representative of the company can get a Spanish ID for foreigners. Marosa provides fiscal representative services in Spain. We take care of VAT and EORI registrations, VAT returns, Intrastat and customs formalities. Get in contact with us to receive a fee quote on Spanish or other European obligations.

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Spanish VAT grouping

There is only an administrative simplification for VAT groups in Spain. VAT groups are not treated as a single taxable person and intra-group supplies are not disregarded for VAT purposes. Each individual entity has its own VAT obligations; however, all VAT due can be consolidated into a single payment, allowing for an administrative and cash flow advantage for groups of companies. Permanent establishments cannot, as a general rule, be part of the VAT group unless they are the head of the group.

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Spanish consignment or call-off stock

The EU introduced a call-off stock simplification that all EU Member States must implement. This simplification allows businesses to operate under a consignment stock structure without having to VAT register in the country of destination. Spain has implemented this simplification. In Spanish this also known as "Acuerdos de ventas de bienes en consigna".

In the past, when a foreign supplier sent goods to a Spanish warehouse to store these goods locally and supply them to a Spanish customer as and when required by the client, this foreign supplier had to register for VAT purposes in Spain.

However, where the EU call-off stock simplification applies, the Spanish VAT registration of the foreign business is not required, and the transaction is treated as a “direct” intra-Community supply of goods from the foreign business to the Spanish client, allowing a reduction of compliance costs and administrative burdens, as well as cash-flow benefits for the client.

This article explains the wide EU call off-stock simplification.

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Spanish bad debt relief

Bad debt recovery of VAT in Spain is possible, and the mechanism has been simplified. Recovering VAT from the authorities when the transaction amounts are total or partially irrecoverable. This is considered when the following conditions are met:

1. One year has passed since the unpaid VAT was due, or six months if the taxpayer is a small size business (categorized as PYME in Spain).
2. This situation is reflected on the company’s VAT books.
3. That the debtor is a taxable person or, in case of a final customer, that the unpaid VAT amount is higher than EUR 50.
4. That the taxpayer has claimed the debt making a legal claim, notarial requirement or by any other means that irrefutably proves the claim for collection to the debtor.

The modification on the taxable base must be done within the six months following the end of one year or six months term to assess the debt and irrecoverable.

There is a specific procedure to follow, including the issuance of a credit note and sent it to the debtor, submit a specific form via the electronic services of the tax authorities, including a list of supporting documents required – basically, copy of the credit notes and proof of having claimed the debt.

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Spanish import VAT deferral and postponed VAT accounting

Spain has introduced the simplification of postponed import VAT accounting. This regime consists on applying reverse charge on import VAT amounts.

Normally, companies must pay VAT upon importation and they are able to deduct this VAT only when the VAT return is filed. Postponed import VAT allows for payment and deduction in the VAT return, with nil cash flow impact. Effectively, this is a reverse charge mechanism on import VAT.

Spanish postponed import VAT accounting is only allowed for businesses filing monthly VAT returns. These are companies with a turnover above 6 M €, companies registered in the Monthly Refund Registry and VAT groups. The application must be filed within the month of November prior to the year in which the simplification will apply. For example, if your business would like to benefit from this simplification as from 1^st January 2023, you must file your application between 1^st and 30^th November 2022. Additional formalities must be met.

Import VAT deferral allows import VAT to be paid at a later stage. Some countries allow a period of up to 40 days to make the payment after the importation is made. Spain has not introduced this simplification.

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Spanish VAT warehouse and Customs warehouse

Customs or bonded warehouse regime is available for goods that have not cleared customs in the EU (T1). VAT and excise duties are not due when these goods are directly placed in the Customs warehouse. As soon as they exit this regime, these amounts are due. Sales within the customs warehouse are zero rated. There are certain administrative obligations such as form 380 and specific bookkeeping requirements. Customs warehouses are referred as "Deposito Aduanero" in Spanish. VAT warehouse is available for cleared goods (T2). These goods have already paid customs duties. The conditions are similar to those of Customs warehouses. VAT warehouses are referred as "Deposito distinto del aduanero" in Spanish.

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Cash accounting scheme in Spain

This regime is available in Spain. An application for Cash accounting regime must be made and the following requirements must be met:

• A registration form must be filed during the month of December of the year prior to the application of the regime.
• Only businesses with a turnover below 2M€ can apply.
• Business gifts are 0% deductible unless for promotion samples or low value gifts (less than 200€ per year)
• A number of transactions and sectors are excluded: fisheries industry, agriculture, simplified margin scheme for SME, intra-Community acquisitions, reverse charge supplies and imports.
• The application of this regime must be stated on the invoice.
• Additional information should be included in the VAT books for supplies under this regime
• All these supplies should be reported separately in the Annual Sales and Purchases Listing (Form 347)

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Reverse Charge in Spain

Spanish reverse charge for non-established companies

According to art 194 of the VAT Directive, Member States may implement an optional reverse charge on supplies made by non-established businesses. Spain has introduced an extended version of this reverse charge. Where a non-established supplier sells goods to a taxable person, domestic reverse charge applies. It is not relevant if the supplier is registered or not. Regarding the customer, it is not relevant if it is established or VAT registered. Even when the customer is not VAT registered, reverse charge applies, hence requiring this customer to register and account for VAT. For services, however, domestic reverse charge would only apply where a) the supplier is not established, b) the service is located in Spain according to the exceptions to the B2B rule (e.g. admission to events, land related, etc.) and the c) the customer is established in Spain for VAT purposes.

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Spanish reverse charge on B2B Services

Article 196 of the VAT Directive requires the reverse charge mechanism on all services subject to the B2B rule introduced in art. 44 of the same Directive. The B2B rule locates the transaction where the business customer is located. In case the customer is a private individual, B2C rules locate the transaction where the supplier is located. According to the general B2B rule, any business not established in Spain supplying services to a Spanish registered customer will not charge any VAT and the transaction will be reverse charged by the customer. There are however a number of exceptions to this rule. Where these exceptions apply, reverse charge is still applicable in Spain:

• Services connected to immoveable property are located where the property is located.
• Passenger transport services will be located where the transport takes places (apportioned if necessary).
• Catering services are located where the catering takes place Short term leasing of means of transport are located where the vehicle put at the disposal of the customer.
• Access to conferences, fairs and exhibitions is located where the event takes place.

There are additional exceptions to the B2B rule such as certain intermediary services, freight services and others. Also, Member States can implement the Use and enjoyment rule also deviates the place of supply from the usual B2B rule.

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Reverse charge on specific goods in Spain

Domestic reverse charge may also apply on certain specific goods or services. This regime is often introduced on products that are more likely to be used for carousel fraud purposes. The customer and supplier conditions for this reverse charge to apply change depending on the goods traded. IT equipment: Reverse charge applies on mobile phones, video-consoles, laptops and tablets. For this RC to apply, there're two scenarios based on value and customer conditions:

• Where the customer is a "reseller", RC applies irrespective of the threshold.
• If customer is not a "reseller", RC applies on supplies above 10k €.

Resellers (companies buying and selling these goods as their usual business) need to apply for a certificate. They will provide this certificate to their supplier as a proof of the need to apply RC. Supplies of natural gas and electricity: Reverse charge always applies on supplies of natural gas and electricity provided the supplier is not established, and the customer is a taxable person. Other goods: Reverse charge applies to the following goods and services applies in any case.

• Emission rights and emission units
• Supplies of waste.
• Supply of certain gold products
• Raw or semi-manufactured silver, platinum and palladium.
• Supplies of gas and electricity, when the supplier is a non-established company, and the customer is a taxable person VAT registered in Spain.
• Construction services.
• Certain supplies of immovable property.

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Spanish use and enjoyment rules

When it comes to establishing the place of supply of a transaction, Member states may introduce another exception to the B2B rule according to the place where the services have been used and enjoyed. This exception may be introduced to avoid double taxation (positive use and enjoyment rules) or to avoid non-taxation (negative use and enjoyment rules) or both. Spain has introduced the negative use and enjoyment, hence attracting the place of supply to Spain if the customer is established outside the EU but the actual use of the service is connected to Spain. This the scope of the use and enjoyment rule in Spain:

• The following services are in scope for the B2B transactions: the lease of means of transport.
• Also, the negative use and enjoyment rule applies to the B2C supplies of intangible services and lease of means of transport made to customers not established in the EU, when the actual consumption takes place in Spain. The list of intangible services consists of the transfer of copyrights and similar services, supply of staff, financial and banking services, data processing, consultancy services, advertising services, hiring of moveable property, and access to electricity and gas.

Find here the VAT news related to the recent change on the Spanish use and enjoyment rules.

Spain has not introduced the positive use and enjoyment rules which deviate the place of supply to a non-EU country where the services are used and enjoyed in that EU country. In these scenarios, there is indeed a risk of double taxation in Spain.

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VAT Returns in Spain

Frequency of Spanish VAT returns

As a general rule, VAT returns are filed quarterly in Spain. The quarterly periods follow the calendar quarters, from January to March, April to June, July to September, and October to December.

Where the Spanish revenue of a business exceeds the 6,010,121.04€ threshold during the previous calendar year, or where the business applies for the Monthly Refund Scheme, monthly VAT returns are due. To calculate this revenue, all outgoing invoices are taken into account, including exempt and zero-rated supplies. All incoming invoices should be disregarded.

In Spain, there is no annual periodicity for VAT returns, not even for small enterprises. However, most companies submitting periodic VAT returns must submit an Annual VAT return which is a summary return of the figures reported during the year.

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Frequency of filing

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Due date of Spanish VAT returns

Spanish VAT returns are filed on a quarterly basis unless the monthly reporting period  is applicable. The quarterly and monthly VAT returns are due by the 20^th day of month, except for the December and Q4 returns, which are due by the 30th January.

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Due date rules

If the due date falls on a Saturday, Sunday or bank holiday, the date is shifted to the next working day. The Spanish authorities publish calendar with all tax due dates.

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Spanish annual VAT returns

Most companies registered for VAT purposes in Spain and filing quarterly VAT returns must submit an additional annual VAT return by the end of the year. This is a recapitulative return for informative purposes, therefore no VAT payment is due upon its submission. This return is also known as modelo 390.  Instructions are published by the tax authorities and updated if necessary, every year.

Annual VAT returns is Spain must be submitted no later than the 30th day of January following the reporting period. If this day falls in weekend, deadline will be moved to the next working day.

Spanish Annual VAT return is not due in the following cases:

• If the company is submitting the SII books there is no obligation to submit the Annual VAT – this could be case of a company under REDEME (monthly refund regime), VAT groups, or Big companies – “Grandes empresas” with an annual turnover higher than 6 M € threshold.
• Companies under simplified VAT regimes related to rental of immovable property.

Concerning companies filing monthly VAT returns and SII Books, although they do not have to submit the Annual VAT return, they must complete an extra section in the December VAT return (or modelo 303) to report the details of the annual turnover.

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Spanish VAT payments

There are two methods for making VAT payments in Spain: i) the NRC code method, or ii) by making a bank transfer from a foreign bank account.

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NRC Code method

This method must be done from one of the authorized banks in Spain (most retail banks are included).

The list of authorised bank is publishec by the tax authorities.

When requesting the payment, you must provide the VAT number, name, period, form submitted, and amount paid to the bank. Once the payment is made, the bank will issue the so called "NRC code" which you need to enter in the VAT return before submitting it. This is, it is not possible to submit Spanish returns without having made the corresponding VAT payment. The bank account can be on the name of any other person.

Only in case the payment is made through the website of the Spanish tax authorities, the bank account must be on the name of the tax payer or its fiscal representative. All bank charges should be borne by the taxpayer. There is no need to provide a bank account number when requesting the payment. The Spanish bank will make the payment to the tax authorities according to their standard process for these payments.

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Bank transfer from foreign bank account

This method consists of making a direct bank transfer from a foreign bank account. This method was introduced to ease the VAT payment process for foreign businesses. Once you have completed your VAT return, you will have the option to pay the VAT due via a bank transfer. You will need to complete certain information fields, including information about the bank account from which the payment will be made. You will then see the bank account information where you need to make your payment.

As a reference on your bank transfer, you will need to indicate your Spanish VAT number. All payments should be made in euros, and any payment made in another currency will be rejected. Also, all bank transfer fees should be paid by the taxpayer. You will find more information in our dedicated article here.

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Spanish VAT refunds

When a VAT return is in a repayable position, a VAT refund can only be requested in the December or Q4 VAT return, except for businesses registered in the Monthly Refund Scheme.

Only those businesses registered in the Monthly Refund Scheme (so called REDEME) can request monthly VAT refunds. This scheme requires a number of additional compliance obligations.

At the bottom of the VAT return, there are sections that can be ticked to determine whether the VAT return is on a payable position ("a ingresar") or, in case the return is on a repayable position, VAT should be carried forward to the next period ("a compensar"), or repaid to the taxpayer ("solicitar devolucion"). In case of repayment, Spanish VAT refunds can be received in a foreign SEPA bank account. The IBAN number of this account must be included at the bottom of the VAT return form. The Spanish authorities must reimburse the VAT within six months following the deadline to submit the VAT return.

An audit or VAT verification process interrupts the six-month time. In case VAT is refunded after the six-month period (even when an audit has been carried by the authorities), interest will be paid in addition to the VAT amount refunded. Audits are not always carried when requesting a refund, however, these happen often for material amounts or significant changes in the VAT position.

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Spanish nil and corrective VAT returns

A nil VAT return needs to be submitted even if there are no transactions to be reported for that period. The option "Sin actividad" needs to be ticked. Regarding corrections, a corrective VAT return must be filed whenever the VAT position changes. The following scenarios can happen:

• Additional output VAT or less input VAT (VAT position increased): A new return replacing all data of the previous return needs to be submitted. The box "Declaración complementaria" should be ticked and the reference number of the initial return should be entered. Payment of the additional VAT should be made by the usual process. The authorities will charge penalties on the VAT paid late. See below section on Late payment penalties (link to section). The form applicable at the time of the period corrected should be used.
• All other corrections (including: less output VAT or no changes to the VAT position): A letter needs to be sent to the Spanish tax authorities informing about the change. The authorities should refund the amount within the six months following the submission of the letter, which can be sent electronically through the website of the authorities.

Corrective VAT returns are submitted electronically. The process is the same as the usual returns, but the box ‘Declaracion complementaria’ should be ticked.

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VAT penalties in Spain

If paid within the deadline provided in the letter where the penalties are stated, the amounts are reduced by 25%. Additional penalties may be charged by the authorities, particularly where the corrections are triggered by an investigation or VAT audit. For penalties on ECSL, Intrastat and other returns, please see the relevant section.

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Spanish distance Sales. VAT on e-commerce

You can find information about the general EU VAT regime on distance sales in our article about VAT on e-commerce. You may also watch our webinar explaining VAT rules for e-commerce in the European Union.

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Spanish tax authorities contact

Unlike other EU countries, Spain does not have a non-established taxable persons unit. Foreign companies are registered at the tax office of their fiscal representative or the office where they have a permanent establishment. When replying to a request from the authorities, it is recommended to send the response to the office and address stated in the letter. However, according to Spanish administrative rules, these documents can be submitted in any tax administration. The following tax office is often used for being one of the largest of Spain and being located in Madrid:

Agencia Estatal de la Administración Tributaria Delegación de Hacienda Calle de Guzmán el Bueno, 139 28003 Madrid Telephone: +34 915 826 178

There is telephone number for general enquiries about VAT and other tax related issues. Information is only given in Spanish and for general purposes (we recommend not to rely on this information only): +34 901 335 533

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Spanish ESPL returns

Due date and frequency of Spanish ESPL returns

ESPL returns are filed on a quarterly basis unless the (rather low) threshold is exceeded. These returns are due by the 20^th day of month together with the VAT return (there is a holiday extension for the December and Q4 returns).

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Frequency of filing rules

The acquisitions are not taken into account when calculating the thresholds for the frequency of filing Spanish ESPL returns. In case of reporting only acquisitions, the frequency of filing will always be quarterly.

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Due date rules

If the due date falls on a Saturday, Sunday or bank holiday, the date is shifted to the next working day.

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Spanish nil ESPL returns and How to correct a Spanish ESPL return?

If there are no intra-Community transactions to be reported in a given period, a nil ESPL is NOT due. To correct an ESPL return, the software published by the authorities needs to be used. In the first page, you can choose between:

• "Declaración sustitutiva": This will replace the previous return with the new return.
• "Declaración complementaria": This will add data to a previously submitted return.

In case you only want to change the details of a previously submitted ESL return, you do not tick any of the two options above, but you complete the third tab in the return. The first section of this tab reports the data initially declared, the second section below reports the corrected data.

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Penalties for late Spanish ESPL returns

Late filing an ESL return in Spain has a fixed penalty of 150€. If paid within the given deadline, this can be reduced to 112€. These penalties may however change every year. In some instances, the authorities can apply penalties foreseen in a separate VAT decree for late ESL returns. These penalties can go up to 1% of the reported amount if voluntarily regularized or 2% if requested by the authorities. Should these penalties be charged, we suggest contesting the requested penalties with an appeal submitted at the relevant tax office.

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Intrastat Returns in Spain

Frequency of filling and due date of Spanish Intrastat

Like in most EU countries, Spanish Intrastat returns are filed monthly. They follow the calendar month. The due date to file these returns is the 12^th day of the following month. If this due date falls on a Sunday or public holiday, the date is shifted to the next working day. Saturdays are considered as working days for Intrastat purposes.

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Spanish Intrastat thresholds

The following annual Intrastat thresholds apply in Spain (calendar year):

These thresholds are computed annually according to the calendar year. Once filed, a calendar year needs to be covered by a business in order to stop filing these returns. For example, if a company exceeds the threshold in March 2022 on arrivals, Intrastat returns for arrivals are due until December 2023. These thresholds are calculated according to the invoice value. Once the threshold for detailed Intrastat returns is exceeded, the taxpayer should also provide the statistical value of the goods.

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Reporting of specific scenarios in Spain

Very often, the transactions reported in the Intrastat return are standard sales from one taxable person to another. However, a number of scenarios have specific reporting requirements.

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Spanish nil Intrastat returns and Corrective Intrastat returns

If no transactions are to be reported, a nil Intrastat return MUST be filed. Intrastat corrections can be made by accessing the Intrastat section of the authorities website and selecting the option "Consulta, modificación y anulación de declaraciones Intrastat" (this option requires a digital certificate). Then you enter the VAT number and period that you want to correct. You select the second option on the top left corner ""Modificar partida"" and you enter the new details. The following aspects should also be considered:

• A credit note, discount or other changes in the value does not require a corrective Intrastat return.
• You can only correct an Intrastat return with transactions reported. Nil intrastat returns must be deleted first ("cancelar partida") and submitted again later.
• Intrastat returns from the previous calendar year can only be corrected before April 30^th of the following year. For example, you can correct March 2022 in February 2023, but you cannot correct December 2022 in June 2023.

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SII – Electronic Submission of Accounting data

SII obligations in Spain

As from 1 July 2017 the Spanish tax authorities have introduced a system for the immediate supply of accounting information to the tax authorities. The submission of accounting data via this platform is mandatory for all taxpayers filing monthly VAT returns, i.e.:

• Companies registered with the REDEME (Monthly Refund Scheme)
• Large businesses with a turnover above 6,010,121.04 €
• VAT groups

There is also the possibility to opt in voluntarily for the SII with a minimum tie-in period of the corresponding calendar year. Taxpayers subscribed to the SII must provide the tax authorities with the electronic invoicing record of the following Books:

• Book of Invoices issued
• Book of Invoices Received
• Book for Certain Intra-Community Transactions
• Book of Investment Goods

The Information will be sent electronically via a Web service using XML-files for communication. These XML-files can be created by using an extension of your ERP-system or by using a third-party software solution. Furthermore, there is the option to use an online form for a small number of transactions. At Marosa we have developed a Software solution for the SII submission process where you provide us with your accounting information via a template and we will convert your information into the format required, submit it to the Spanish tax authorities and provide you with the response of the Spanish tax authorities"

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SII due dates in Spain

The SII information has to be submitted in a time frame of four calendar days, more precisely:

The term of four calendar days excludes Saturdays, Sundays and national holidays."

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SII penalties in Spain

The fines for a delay are calculated as 0.5% of the invoice amount in the record, with a quarterly minimum of 300 € and a maximum of 6000 €.

SII impact on VAT return in Spain

The Spanish tax authorities require the data submitted via the SII platform to match the information of the VAT returns. It is important that all your SII data reported during the month reconciles with your VAT return reported on a monthly basis. If there are differences, these should be resolved so all data is aligned. In order to show all transactions in a given period in the CSV downloaded from your online account, you will need to tick on the option "Exportacion sin límite". Marosa may assist you producing this request and converting the reply from the tax authorities into Microsoft Excel. We can also help you reviewing the reconciliation made by the tax authorities and taking the relevant actions with your suppliers and customers.

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Review the data exported

Once you have downloaded all invoice listings reported during a given period, you can check if they have been reconciled by the tax authorities against your suppliers and customers in the last column (header: "Estado cuadre"). You can get four possible messages:

• "Contrastada": The invoice has been reconciled against data reported by your supplier or customer under the SII system.
• "No contrastada": The invoice has not been reconciled against data reported by your supplier or customer under the SII system.
• "Parcialmente contrastada": Only part of the information has been reconciled against your supplier or customer data under the SII system.
• "No contrastable": The invoice cannot be reconciled because the supplier or customer are not the SII system.

We also recommend checking under column "Estado" if there are invoices accepted with errors ("aceptada con errores"). In these cases, such entries should be corrected to change the status into "Correcto". Please note that reconciled information is only informative. Only the data reported in your VAT return is considered final and your VAT payment must reconcile with your VAT return. In the following links you can find additional information as published by the Spanish tax authorities:

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• How is the reconciliation process carried out?
• Can you double check the information reported by suppliers and customers?
• Is the SII data impacting your periodic VAT return?