Tax rate by region Spain

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Understanding SaaS Sales Tax in Spain: A Comprehensive Guide for Businesses

In Spain, the sale of software as a service (SaaS) is subject to Value-Added Tax (VAT), following the EU VAT system implemented in 1986. The standard VAT rate for SaaS in Spain is 21%, applicable to most digital services. A reduced rate of 10% applies to certain educational services, though specific conditions may be attached.

Spain

Spain implemented the EU VAT system in 1986 to align its tax framework with European regulations.

Official government link: Agencia Tributaria

21.00%

E-products and services VAT/Sales tax rate

10.00%

Reduced tax rate

Reduced tax rate product categories

E-books, electronic publications and online educational services

Exempted product categories

Some educational services may be exempt if they meet specific criteria related to the educational institution or provider.

Reverse charge mechanism for B2B sales

Yes

Tax ID validation required

Yes

When do you have to register

Non-resident companies have to register as soon as goods are being delivered or services are being provided

Online registration possible

Yes

Local representative needed

Yes

Registration procedure

Steps for registration for VAT MOSS in Spain:

Request an individual identification code. Email the Spanish Tax Agency and request your identification code;
The agency will issue your code via email and give you specific instructions to retrieve a certificate;
Fill out form 034, the version titled «System outside the Union»;
Access Spain’s tax portal.

List of digital and electronic services liable for tax

E-books, images, movies, and videos, whether purchased from Shopify or accessed through services like Netflix, fall under the tax category of “Audio, visual, or audio-visual products.”

Downloadable and streaming music, whether buying an MP3 or using services like SoundCloud or Spotify, are categorized as audio products.

Cloud-based software and as-a-Service products, including Software-as-a-Service (SaaS), Platform-as-a-Service (PaaS), and Infrastructure-as-a-Service (IaaS).

Websites, site hosting services, and internet service providers.

Online advertisements and affiliate marketing.

Penalties

Late filing of VAT returns:

No prior requirement: If you file late without a prior request from the tax authorities, the penalty is 5% of the VAT due, with a minimum of €300 and a maximum of €6,000 per quarter.
With prior requirement: If you file late after a request from the tax authorities, the penalty increases to 10% of the VAT due, with the same minimum and maximum amounts.
Incorrect or incomplete information: If you provide incorrect or incomplete information on your VAT return, you may face a penalty of 1% of the incorrect amount, with a minimum of €150 and a maximum of €6,000.
Late payment of VAT:

Interest: You’ll be charged interest on late VAT payments, which can be up to 5% per month overdue.

Registration threshold

No threshold, non-resident companies must register for VAT

Filing interval

Quarterly

Filing deadline

20 April, for the first quarter ending 31 March;
20 July, for the second quarter ending 30 June;
20 October, for the third quarter ending 30 September;
20 January, for the fourth quarter ending 31 December.

E-invoicing requirements

Yes

Record keeping

Records of completed transactions must be maintained to verify the accuracy of tax returns and payments. These records should be accessible electronically to the Tax Agency of Spain or the relevant central authority of other EU Member States upon request. The retention period for these records is ten years.

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Key Requirements for SaaS VAT Compliance in Spain

Compliance with SaaS VAT regulations in Spain involves several key requirements. Businesses must file VAT returns and make payments quarterly. The deadlines for these payments are as follows: 20 April for the first quarter (ending 31 March), 20 July for the second quarter (ending 30 June), 20 October for the third quarter (ending 30 September), and 20 January for the fourth quarter (ending 31 December).

Additionally, businesses must meticulously maintain records of their transactions for ten years, ensuring these records are electronically accessible to the Spanish Tax Agency or other relevant EU authorities.

Best Practices for SaaS VAT Management in Spain

To effectively manage SaaS VAT in Spain, businesses should implement robust systems for tracking sales and calculating taxes. Employing e-invoicing is highly recommended, as it streamlines the process and reduces the risk of errors. Seeking professional guidance from tax advisors is also crucial for ensuring complete understanding and adherence to regulations.

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