Spain introduced Value Added Tax (VAT) in 1986 when it became a member of the European Union (EU). It has incorporated the EU VAT Directives into local Spanish VAT Laws, Regulations and Instructions. This covers the details of Spanish VAT registrations, compliance and returns. VAT in Spain is overseen by the Agencia Estatal de Administración Tributaria.
Any company making taxable supplies of goods or services may be required to charge VAT. This first requires a Spanish VAT registration.
Spain follows the broad EU VAT rules on the requirement for foreign companies to register for local VAT. There are a number of differences, particularly the use of the reverse charge. The principle situations where a re :
Since the 2010 EU VAT Package, there are almost no circumstances where a non-resident VAT registration is required in Spain. Instead, the Spanish customer records the transaction under the reverse charge mechanism.
Our briefing on Spanish VAT Registrations explains the details of the registration process, including the local VAT registration threshold.