Country-specific updates: Spain

Until 31 March 2021, UK-established VAT taxable persons could make a reclaim of Spanish VAT incurred on goods and services during the year ended 31 December 2020 under the EU VAT refund procedure. Spanish input VAT incurred as from 1 January 2021 by UK and other third country established businesses however must be requested using the special procedure for persons established outside of the EU which requires:

• Taxpayers to appoint a tax representative in Spain;
• Reciprocity with the UK.

In this regard, on 5 January 2021, the General Directorate of Taxes issued a resolution declaring the existence of reciprocity with the UK for the purposes of the VAT Refund Procedure.

The General Directorate of Taxes has also issued a public ruling confirming that if the transport of goods from UK to Spain commenced before 31 December 2020 and can be properly evidenced, then it would qualify as an intra-EU acquisition instead of an import of goods even if the goods arrived in Spain after that time. This mirrors the treatment for imports to the UK.