Tax tip of the week!
Did you know if you are charged VAT on business activities in Spain where you are not established, you are entitled to have that VAT refunded by the Spanish tax authorities?
But you must claim your VAT refund online, via the authorities in the country where your business is based. Copy of invoices are required for amounts in excess of 1.000 euros.
If you are eligible for the refund, your local tax authorities will pass on your claim to the tax authorities in Spain which must refund the VAT directly to the company. The deadline for submission is 30 September of the year following the year in which the invoice was raised. The application must cover a period of non less than a calendar quarter in a calendar year and not more than one calendar year.
Spain has 4 months to process your complete file with effect from the date of receipt of the electronic file. However, if the tax offices require additional documents to study the refund, the period may extend to 8 months. Once the claim is approved, payment is then made within 10 working days. Interest must be paid in the event of a late refund and it is always possible to appeal against a decision to refuse or partially reject a claim.