VAT refund for companies: learn more

NOTE: As of January 2010, the following no longer applies to European companies.

The Spanish tax authorities are making the process to obtain the VAT refund for companies simpler. The following explains how the process for receiving a VAT refund works.

FAQs:

These FAQs on VAT refunds are based in the Spanish tax office web site. Applicable regulations are:

European Community Council Directive 77/388/EEC of 17 May 1977.

European Community Council Directive 79/1072/EEC of 6 December 1979.

European Community Council Directive 86/560/EEC of 17 November 1986.

Law 37/1992 on Value Added Tax (Ley 37/1992 del IVA): Section 119

VAT Regulations approved by Royal Decree 1624/1992 (RD 1624/1992): Section 31

Who can apply for a VAT refund?

You can apply for a VAT refund for VAT paid or incurred in Spanish territory if you meet all the following requirements:

• If you are a VAT taxpayer in your country of residence.
• If you are established in the territory of the European Union, including the Canary Islands, Ceuta and Melilla, or if you reside in one of the countries where there is a reciprocity agreement (Canada, Japan, Norway, Monaco, and Switzerland).
• If you do not own a company in Spain (or you have a company but the company has not carried out any transactions).
• If you have not carried out any transactions in Spanish territory, or if you have only carried out transactions with a right to a refund, consisting of:
  • Delivery of assets and provision of services, including intra-community transport, in which the taxpayer is the recipient of said transactions ("investment by the taxpayer").
  • Transport related to the importing and exporting of goods, or directly related to the delivery of goods in a duty-free zone, bonded warehouse or similar deposit, and similar Customs and Excise Regimes. Some specific provisions of accessory transport services are exempt from the tax.

Can I apply for a VAT refund directly or do I need a representative?

Should the applicant not reside in the European Union, it is necessary to appoint a representative in Spain through a publicly recognised power of attorney. Applicants who reside in a European Union country may appoint a representative if they so choose. If the refund is to be collected by a representative, the power of attorney granted must expressly grant this power.

What period does the refund application apply to?

Applications for VAT refunds may only be made with respect to the immediately preceding year or quarter. The application may also refer to a period of less than a quarter, when this represents the entirety of the transactions carried out in a full year, provided that they finish on 31 December of the year in question.

Is there a minimum amount for a refund application?

The total amount of the VAT refund may not be lower than 200 euros (for a quarterly application) or 25 euros (for an annual application).

What is the final date for applying?

The deadline for filing the VAT refund application is 6 months following the end of the calendar year in which the payments have been made.

How is the VAT refund paid?

The VAT refund will be made by bank transfer to a financial institution in Spain or in the applicant's country. In order to make the refund, the applicant must include on the application form an account number, the name of the account holder (the applicant or authorised representative) and the address and code number of the financial institution. In order to avoid problems with payments made outside Spain, you should provide your bank's IBAN and SWIFT code.

My company is in the Canary Islands. Where should I send my application?

The competent body for processing and deciding on applications for refunds by businesses and professionals resident in the Canary Islands, Ceuta and Melilla is the Branch of the Tax Agency corresponding to tax address or, in its absence, the permanent establishment of the party in these territories.