The TEAC Departs from the DGT’s Interpretation of Import VAT Deferral
In its decision of 18 June 2026 (RG 00/01021/2025), the Central Economic-Administrative Tribunal (TEAC) examines when a taxpayer must have a monthly VAT settlement period (filing VAT returns every month instead of every quarter) to use the deferred import VAT scheme (which allows the payment of import VAT to be postponed) under Article 167(2) of Law 37/1992 on VAT and Article 74(1) of its implementing regulations. The decision differs from the position taken by the Directorate General for Taxation (DGT) on when this condition must be met.
Requirements for deferring import VAT
Under this scheme, certain importers can account for VAT assessed by Customs through their periodic VAT return instead of paying it under the standard customs assessment procedure. In practice, rather than paying VAT at customs when the goods are imported, they report it later in their regular VAT return.
To use the scheme, the importer must be acting as a business or professional and must have a VAT settlement period that matches the calendar month. As a general rule, the option must be exercised in November before the calendar year in which it is to take effect. For example, to apply the scheme in 2027, the option must be filed in November 2026.
The TEAC's Interpretation of When the Scheme Applies
The issue is whether the monthly settlement period must already apply when the option is filed, or whether it is enough for the requirement to be met in the year in which the scheme takes effect. The TEAC considers that requiring taxpayers to already have a monthly settlement period when they file the option may be disproportionate in certain cases.
In its view, the requirement must be met in the year in which the option takes effect. Following the example above, it would be enough to have a monthly settlement period during 2027, even if this was not yet the case in November 2026. However, when applying, the taxpayer must provide evidence that its settlement period will be monthly during that year.
The role of REDEME in proving monthly settlement
For these purposes, the TEAC accepts that evidence of compliance is not limited to cases in which the taxpayer is already subject to monthly VAT settlements when exercising the option.
Submitting a simultaneous application for inclusion in the Monthly VAT Refund Register (REDEME) may also be sufficient.
Conversely, the mere fact that the turnover recorded in November exceeds the threshold associated with large company status does not, in itself, demonstrate that the VAT settlement period will be monthly in the following tax year. This is because large company status must be determined in accordance with the applicable rules governing annual turnover.
Scope of the TEAC Decision on Import VAT
In the specific case examined, the decision rejects the company's claim, concluding that it had not provided sufficient evidence that it would meet the monthly VAT settlement requirement in the following tax year.
Therefore, the interpretation does not exempt taxpayers from complying with the substantive requirement. Rather, it clarifies when that requirement must be met and what evidence is necessary to demonstrate compliance.
Furthermore, the TEAC expressly identifies its interpretation as non-binding, a circumstance that must be taken into account when assessing its implications for other proceedings.
Practical Implications for Importing Companies
In practice, importers considering deferred import VAT should plan their November tax-registration option (the application to join the scheme) and keep sufficient evidence that they will be subject to monthly settlement during the following year.
Where appropriate, a simultaneous application to join REDEME may help demonstrate this. Businesses should review their tax registration status and turnover forecasts and retain supporting documents, bearing in mind that the scheme requires monthly VAT settlement and applies to imports within its scope.
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