How VAT works on sales outside of Spain
Although VAT is a neutral tax for companies or individual entrepreneurs, you always have to be very careful in operations that carry VAT. For example, sales outside of Spain.
The tax agency is very strict with the requirements for not entering VAT in the treasury and sets many requirements for the justification of sales outside Spain.
Nowadays it is very difficult to make money, get the most out of your product, create new companies, because there is more and more competition, even from abroad.
By this we mean that there is a lot of cunning with things that do not have to do with your product, but with external things, for example VAT.
There are companies that do not pay VAT and then are cheaper and earn more money.
That’s why the treasury controls VAT-exempt operations a lot.
In this article we will explain the requirements that you have to ask to not charge VAT to your customers on sales outside of Spain.
The exporter is the acquirer in sales outside of Spain
If your company sells and sends its products to other companies located outside Spain, you should not pass on VAT to them.
But…
How should you act if the delivery of the goods takes place in Spain and it is these companies that take them abroad?
Sales within Spain without VAT
In general, if your company delivers goods to other companies within “Spanish VAT territory” (TAI) – in the Peninsula and the Balearic Islands -, you must pass on VAT for these sales (they are subject operations and not exempt).
However, if the acquiring company is established outside Spain, it may not have to pass on VAT (in this case the operation is considered subject and exempt).
For this purpose, it is necessary that the acquiring company:
- Inform you that you are going to take the goods out of Spain, either by your own means or through a third party hired by you.
- And that documentally justifies that the products have been transported outside Spain.
Sales outside the European Union: export
Transport to customs
If the acquiring company is going to take these products outside the European Union (in which case it will be an export), it is necessary that before one month from the sale outside Spain it takes them to customs, and that it gives you the receipts of having carried out an international transport.
In particular, you must provide you with the export DUA (a copy completed by the customs office of exit) and a copy of the transport documents.
Recommendation
If it is an operation with a client that your company does not know, it is recommended that you first issue the invoice with VAT and, once you have received the receipts, make the corresponding rectification and refund the tax paid (if you have already paid it).
In any case, if the goods from sales outside Spain take more than a month to leave Spain and your company has issued the invoice without VAT, do not allow the Treasury to demand the tax.
Even if this temporary period is not complied with, if it can prove that the products have actually left outside the European Union, the Treasury cannot prevent the exemption (this has been established by the European Court).
Exit customs
On the other hand, in these cases it is not necessary for the goods to leave a Spanish customs.
In the event that the customer, after purchasing the goods, exports from the customs of another EU country, the sale will also be exempt if the other requirements are met.
Sales within the European Union: intra-Community deliveries
VAT Exemption
If the acquiring company – or a third party hired by it – takes the products to another EU country and provides a VAT NIF from that territory, the delivery will be an intra-community delivery and will also be exempt (yes, your company must declare the operation in form 349).
In this case, to justify the exit, the acquirer must provide:
- At least two transport-related documents issued by independent parties (for example, a signed CMR letter or document, a waybill or an air freight or carrier bill).
- Or one of the previous evidence and at least one of the following documents accrediting the transport:
- The transport insurance policy,
- The proof of payment,
- An official document issued by a public authority
- The receipt of the goods from a warehouse in the destination country
Very important: the written declaration
In addition, within ten days of delivery of the goods, the purchaser must provide a written declaration certifying that he has transported the goods.
VAT on sales outside Spain in Summary
If the company that acquires the goods accredits that they have been transported outside Spain, the sale will be exempt and your company will not have to pass on VAT.
The supporting documents are different if the goods go to another EU country or leave outside it.
