Today the Spanish Official Gazette published the Resolution of January 4, 2021, on the refund of Value Added Tax to entrepreneurs or professionals established in the United Kingdom of Great Britain and Northern Ireland.
The Resolution recognizes the reciprocity required by Spanish regulations in relation to the refund of VAT to companies or professionals not established in the European Union, included in article 119 bis of Law 37/1992 on VAT, therefore, as a general rule, any entrepreneur or professional established in the United Kingdom of Great Britain and Northern Ireland who supports VAT accrued in Spain for the acquisition of goods and services, as a result of the localization rules, may request the refund of said VAT quotas borne in the same conditions and restrictions applicable to companies or professionals established in Spain.
Additionally, in fair reciprocity, the resolution includes a series of restrictions established in the VAT regulations in force in the United Kingdom of Great Britain and Northern Ireland. In other words, VAT paid would not be refunded in Spain to operations related to:
- For goods and services acquired that do not affect business or professional activity.
- For goods and services that are intended for resale.
- For goods and services that refer to entertainment or services of a recreational nature.
- For the acquisition of a motor vehicle.
- 50 percent of the input VAT, for the rental or financial leasing of a motor vehicle.
The regulation enters into force the day after its publication and the deadlines for the recovery of these input VAT quotas will be those established in the Tax Regulating Law, that is, at the latest, until September 30 of the year immediately following.
Salinas & Partners, with more than 30 years of experience advising on Customs and International Trade, is at your disposal if you want more information, advice or assistance in relation to the content of this information note.
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