Whether you are making a permanent move to Spain or you’re conducting business in the country, there are certain things you need to be aware of when you import products to Spain from the European Union (EU) or from a country outside the EU.
One of the most important considerations is whether you will need to pay value added tax or VAT upon the importation of your goods. This guide is designed to help you figure out where you stand and what you need to do. Let’s explore in more detail below.
What is import VAT?
VAT is a tax that’s levied by practically every government in the world and Spain is no exception. This tax is levied on both goods and services and the general rate for VAT in Spain is 21%. However, there are reduced rates (10%) and super reduced rates (4%), depending on the product being imported.
When it comes to import VAT with regard to Spain in particular, it’s important to bear in mind that import is considered the entry of goods in the interior of the country from a third country. Generally, different rules apply as to whether the source country is within the EU or outside the EU.
Also important to note is that the purpose of the goods and the status of the importer are not relevant. As such, individuals can also perform importing functions (for example, if they move to Spain and change their residency).
Exceptions to the rule
There are, of course, exceptions to the rule of when import VAT is paid in Spain. These include if the goods are housed in zones and “free” warehouses. In addition, this applies if the goods are considered to be a part of “inward processing” or temporary importation. The latter refers to cases when the goods leave an area and then “abandon” the special customs regime.
In addition to the above, individuals who are changing their tax residency also do not have to pay import VAT when they move to Spain. However, they need to prove that the personal belongings that they are bringing into the country are theirs and do not belong to anyone else, that they are, in fact, for personal use and for the same use as used in their home country, and that the goods are not new but at least six months old. Declarations will, however, need to be submitted to the Spanish authorities within the first 12 months of moving to the country in order for you to be on the safe side of the law.
Other exemptions that come to the fore are for goods that are valued at €22 or less. However, this exemption does not apply to alcohol or tobacco products.
There are also different rules when it comes to goods that are imported from non-EU countries.
Where import VAT is paid
Import VAT in Spain is generally paid at the Revenue and Customs Office – Spain.
However, your courier company can help you navigate the field of Spain’s import taxes better.
Especially if you are doing this for the first time and are unsure of where to begin.
Double taxation
Double taxation refers to the process where VAT is paid in the country of origin and the destination country – twice.
To avoid this, new and updated rules have been introduced as charging double VAT is generally avoided.
This means that if a product leaves Spain and is taxed there, it will not be taxed when it is exported and vice versa.
It is also possible to obtain VAT refunds, but this will depend on the nature of the goods, their value and a series of other factors as well (including the VAT rules of the country of origin and the destination country).
Do you need help with your VAT?.
Performing a VAT operation such as calculating import VAT means taking several factors into account simultaneously in order to reach the right calculation and VAT amount. This can be a daunting process, especially as every country has their own VAT processes and legislation.
There are some import companies that work with international courier companies to help ease the processes and ensure you can take advantage of exemptions and lower VAT rates, where possible.
With us at DRG Solutions, you never have to worry about making a misinformed decision again. We can help with any international courier services from Barcelona to practically any destination – in Spain or abroad.
We’ve got the right VAT calculators and can help ensure that you are not paying more than you should be.
