Payment of VAT in Spain by companies selling online – selling online to individuals
The system called “DISTANCE/ONLINE SELLING” is governed by Article 34 of Directive 2006/112, which is included in Article 68 of the Spanish VAT Law. It applies if the buyer of the goods (NOT SERVICES) is an individual and the sale is not made at the seller’s premises. Due to the buyer being a private person and not a company, in this case, the exclusion from VAT payments for transactions between companies within the European Union does not apply.
Therefore, after exceeding the specified limit of online sales (in Spain it is EUR 35,000), the company should settle VAT on sales in the country where this limit was exceeded. This means that the seller must be registered as a VAT payer in the Spanish Tax Office. From the date of registration, it should apply the Spanish VAT rates on the invoices issued to Spanish customers.
It happens very often that sellers who conduct the electronic/online selling are too late in becoming aware of having exceeded a given EU country’s limit. This is an unpleasant situation and results in additional costs for sanctions which could be avoided.
Our accounting office has dealt with VAT settlement in Spain for many years. We offer our foreign clients a guarantee of completing all registration and fiscal activities, security, and satisfaction. Contact us for details on VAT payment in Spain.