A self-employed person in Spain (an autónomo) with clients abroad does not have a VAT problem: they have a geography problem. The question that decides each invoice is not "how much VAT do I charge?" but "where is this service treated as supplied?". If the answer is Spain, there is Spanish VAT; if it is another country, there is not, and then the obligations that take the place of VAT begin. The rules are in articles 69 and 70 of Ley 37/1992, the Spanish VAT Act, and this guide sets them out in the order in which they have to be applied.
First: who is your client?
The whole system turns on a two-way distinction. Your client is either a business or professional acting as such (what is called a B2B transaction) or a final consumer (B2C). A German company is not the same as a German private individual, and the same invoice, for the same work, is treated differently depending on which of the two it is.
Business status is not presumed in good faith. It has to be evidenced, and for clients in the European Union the normal way to evidence it is for them to give you a valid intra-EU VAT number and for you to check it on the VIES database. For clients outside the Union other means will do: a certificate from the tax authority of their country, a local tax identification number, or objective evidence that they carry on an economic activity.
Checking VIES takes a minute and leaves a trace. Keep the result with its date: it is the document that supports the fact that you charged no VAT because your client was a business. If two years later that number turns out to have been deregistered and you do not have the check, the argument becomes much more uncomfortable. The mechanics are in registering on the ROI, step by step.
The general rule, in one table
Article 69.Uno lays down two general rules pointing in opposite directions:
| Type of client | Where the service is located | Your invoice |
|---|---|---|
| Business established in Spain | Spain | With Spanish VAT |
| Business established in another EU member state | Their country | No VAT, under the reverse charge, and reported on Modelo 349 |
| Business established outside the EU | Their country | No Spanish VAT, no 349 |
| Final consumer in Spain | Spain | With Spanish VAT |
| Final consumer in another EU member state | Spain, as the general rule | With Spanish VAT, unless a special rule applies |
| Final consumer outside the EU | Depends on the service | See the next section |
The quick reading is this: in B2B the customer decides, in B2C the supplier decides. Someone whose clients are all businesses outside Spain issues invoices without Spanish VAT, while someone selling to foreign consumers stays, by default, with Spanish VAT, which is almost never what they expected.
The exception in article 69.Dos: services to private clients outside the EU
The supplier rule for B2C has an important way out. Article 69.Dos lists a set of services that are not treated as supplied in Spain when the customer is a final consumer established outside the European Union. The list includes, among others, assignments of industrial and intellectual property rights, advertising, advisory, auditing, engineering, legal, consultancy, accounting and appraisal services, data processing and the supply of information.
Translated into what a Spanish autónomo does: consultancy invoiced to a private individual in the United States or the United Kingdom falls within the list and is invoiced without Spanish VAT. On the other hand, a service not on the list supplied to that same individual follows the general rule and carries Spanish VAT. Before deciding, read the list, because the commercial name of a service does not always match its legal classification.
The special rules in article 70
Above everything so far sits a group of services with their own rule, which is applied before the general one and cannot be overridden by agreement.
| Service | Where it is taxed |
|---|---|
| Connected with immovable property: letting, building work, architecture, property management | Where the property is, regardless of where anyone else is |
| Admission to cultural events, trade fairs, conferences and events | Where the event takes place |
| Restaurant and catering services | Where they are physically provided |
| Passenger transport | By the part of the journey covered in each territory |
| Short-term hire of means of transport | Where they are placed at the customer's disposal |
It is the one that produces the most surprises. A Spanish architect designing a building in Portugal supplies a service located in Portugal, even though the client is a Spanish company and even though the architect never left the studio. The reverse applies too: an adviser established in Germany who manages a flat in Málaga supplies a service located in Spain. Anyone working with property has to look at this rule before any other, and sometimes ends up with registration obligations in the country where the property is.
The effective use clause
Article 70.Dos contains a closing clause: certain services that, under the earlier rules, would not be located in the Spanish VAT territory are nevertheless treated as supplied here when they are actually used or exploited in that territory. Its scope has been narrowed by successive legal reforms and it is not a wild card the tax authorities can play in any case, but it is still alive and you have to check whether the specific service falls within it. When it does, the invoice that looked exempt carries Spanish VAT.
The invoice, when there is no VAT
An invoice without VAT is not an invoice without explanation. The Spanish invoicing regulations require a statement identifying why no VAT is charged, and that statement changes with the case:
- Business client in the EU: a reference to the reverse charge, with the intra-EU VAT numbers of both parties. It goes on Modelo 349.
- Business or private client outside the EU: a statement that the transaction is not subject to Spanish VAT under the place-of-supply rules. It does not go on the 349.
- Service relating to a property in another country: you have to see what obligation arises there, which may be registering in that state.
An invoice in a foreign currency adds the exchange-rate problem, with its own rule on when tax falls due: we cover it in the exchange rate for each invoice.
The other way round: when the supplier is the foreign one
Everything above looks at your sales. Your purchases follow the mirror image: when you use a supplier not established in Spain (advertising on a platform, cloud hosting, a software subscription) you declare the Spanish VAT yourself and, at the same time, deduct it if you are entitled to. That is the mechanism of the reverse charge, which shows up on Modelo 303 in both columns at once.
Four cases from our files, resolved
| Situation | Rule that applies | Invoice |
|---|---|---|
| Programmer in Valencia, client an Irish company with a valid VAT number | General B2B rule: the service is located in Ireland | No VAT, with a reverse-charge reference, and on Modelo 349 |
| Designer in Málaga, private client resident in Canada, branding work | Article 69.Dos: advertising and similar services to a consumer outside the EU | No Spanish VAT, no 349 |
| Spanish photographer hired to cover a conference in Lisbon, client a Spanish company | General B2B rule: the customer is in Spain | With Spanish VAT, even though the work is done abroad |
| Spanish interior designer refurbishing a villa in France for a Spanish client | Special property rule: located in France | No Spanish VAT; you need to check what obligation arises in France |
The third and fourth look alike and end up in opposite places, and that is exactly why a blanket office rule such as "foreigners, no VAT" does not work. What decides is not the client's nationality or where you do the work: it is the connecting factor the law assigns to that particular service.
The mistake that turns an invoice into a debt
When an invoice is issued without VAT and the tax authorities conclude that it should have carried it, the VAT is claimed from the autónomo, not from the client. The foreign client has already paid what was agreed and has no obligation to take on a VAT charge that appears two years later; correcting the invoice and collecting the difference is, in practice, impossible. The result is that the tax comes out of the autónomo's margin, with interest. That is why reviewing the place-of-supply rules is preventive work: done afterwards, it fixes nothing.
The decision tree, in four questions
- Is the service on the list of special rules in article 70? If so, that is the end of it: that rule applies.
- Is your client a business or professional acting as such, and can you prove it? If so, the service is located where the client is established.
- If the client is a final consumer, are they outside the EU and does the service appear on the list in article 69.Dos? If so, outside Spain.
- Is it actually used or exploited in Spain? If so, check the clause in article 70.Dos.
That order is not arbitrary: applying the general rule before the special one is the fastest way to get it wrong. And getting it wrong here is not harmless, because an invoice issued without VAT that should have carried it makes the autónomo the debtor of a tax their client is no longer going to pay.
We are tax lawyers and we deal with this every month. If you invoice clients in several countries and would like us to review the classification of each type of service before you issue the next batch of invoices, write to us through the form for self-employed people with international clients. The general picture is on the page on invoicing clients abroad from Spain. What we are not going to do is give you a single rule for all your invoices: there is no such thing.