Of course, this is not a matter of pan-European rules and regulations in this regard, which apply to all EU countries but which also provide some room for freedom in this regard.
Different VAT rates in Spain
The Spanish VAT is supervised by a government agency called Agencia de Administración Tributaria.
21% – this is the normal rate of VAT in Spain. This rate applies to services and goods which are not subject to lower rates of VAT. These include, for example, advertising and marketing services, the Internet, luxury goods, cosmetics, food, water, fuel, household appliances and TVs, electricity.
The reduced rates are 10%, 4% and 0%.
Public transport, veterinary medicines, cattering, bars, restaurants and hotels just include a 10% VAT rate.
The 4% VAT applies to selected products such as food, medicines for human use, books, periodicals and newspapers, social services and social housing.
As regards 0% of Spanish VAT, this applies, for example, to education and health services.
What does NIF mean in the Spanish tax system?
The abbreviation NIF refers to the Spanish term Número de Identificación Fiscal. It stands for the Spanish VAT identification number.
How does the NIF number look like?
This number can be stored in three different ways. Although the number consists of nine digits and one or two letters. These letters may appear at the beginning, at the end or at the beginning and end of a sequence of numbers. And Spain’s VAT code is ES.
Local tax representative
The institution of the local tax representative is quite firmly anchored in the Spanish tax system. This representative is a guarantee that taxes in Spain are paid reliably and on time by foreign companies.
So in order to obtain a NIF number and submit an application to the Spanish tax office, we need such a representative right at the beginning of the tax procedure. This condition must be met. A representative will be present throughout our business activities in Spain to settle and pay taxes.
INTRASTAT – what is it and which companies implement it?
Some enterprises are also obliged to submit INTRASTAT statistical reports. An important amount in this case is EUR 400,000, which means that if companies import or export goods or services annually exceeding that amount, they have to issue this type of report.
Invoice with Spanish VAT?
If the trader pays VAT in Spain, the invoice must be drawn up by the 16th day of the month following the day on which the goods or services are supplied. Once issued, this document must be archived for at least four years.
What about non-EU taxpayers?
Individuals can claim a refund of Spanish VAT when they return to their country of residence.