Clara Méndez is an interface designer in Alicante. She registered as self-employed in June and her first major client is a company in Rotterdam that has commissioned her to redesign its app for 9,000 €. The Dutch company asks her to invoice "without VAT, with reverse charge" and gives her its VAT number. Clara did not tick anything about intra-Community transactions when she filed Modelo 036 (the Spanish tax registration form) and does not know whether she can issue that invoice as it stands.
She needs the ROI. Without it, the invoice without VAT loses the support that justifies it to Hacienda (the Spanish tax office) and to her client.
What the ROI is and what number it gives you
The ROI (Registro de Operadores Intracomunitarios, the register of intra-Community operators) is a register kept by the Agencia Tributaria, the Spanish tax agency, for people who carry out transactions with businesses in other member states. Once you are included in it, your tax number (NIF) starts to work as a VAT number with the prefix ES in front, under article 25 of the Regulations on tax management and inspection. That number is the one that appears in the European VIES system, which is where your client will check that you are an operator identified for VAT purposes.
Inclusion is requested on Modelo 036 itself, in the registration return or in an amendment if you were already registered, by ticking the application for registration in the register and giving the expected date of the first transaction.
Why an invoice for services to a European business goes without VAT
For most services provided to businesses, the general VAT rule places the supply where the business client is established. If the service is treated as supplied in the Netherlands, it is not taxed in Spain, and the one who accounts for Dutch VAT is the client itself through the reverse charge. That is the logic of the reverse charge that Clara is being asked for.
To apply that rule you have to show that the client is acting as a business. The most common way is its valid VAT number in VIES. And Clara's invoice, in turn, must identify her with a number the client can check. Without the ROI, Clara's tax number does not appear in VIES.
Some services have special place-of-supply rules, such as those connected with property or some catering and event services, and there the reasoning changes. Which rule applies to each service is set out in the guide on where each service is taxed, and the mechanics of the reverse charge in the reverse charge.
The time limit for a decision
Article 25.1 of the Regulations provides that, if the Agencia Tributaria does not decide the application within three months, it may be treated as refused. Silence means no. In addition, the authorities may refuse the number in the cases that the same article 25 lists by cross-reference, among them where checking the details provided shows that they are not true.
In practice, Hacienda may ask for documents to check the activity before including you: contracts, pro forma invoices, a website, premises. It is worth having them ready from the start and not applying to join the ROI "just in case" if there are no foreseeable transactions yet.
| Stage | What happens | Risk |
|---|---|---|
| Application on the 036 | Hacienda considers inclusion | Possible request for documents |
| Inclusion granted | Your tax number appears in VIES with the ES prefix | None in particular |
| Three months without an answer | It may be treated as refused | You have to apply again or appeal |
| Express refusal | You have no VAT number | You cannot prove your status to European clients |
Clara's invoice, step by step
- Service: redesign of an app for a company in Rotterdam.
- Agreed amount: 9,000 €.
- Clara applies to join the ROI by filing an amending 036.
- She checks in VIES that the client's VAT number is valid and keeps the record of the check.
- Once included in the ROI, she issues the invoice for 9,000 €, without Spanish VAT, with a statement that the transaction is subject to the reverse charge, and identifies both parties by their VAT numbers.
- She declares the transaction on her Modelo 303 (the VAT return) for the quarter, in the boxes for transactions not subject to Spanish VAT under the place-of-supply rules.
- She includes it in Modelo 349 for the relevant period.
If her client were a private individual in the Netherlands, the rule would be different: services to final consumers are generally located where the supplier is established, and the invoice would carry Spanish VAT, unless the services have their own rules, such as those supplied electronically, which may lead to the one-stop shop.
If Clara issued the invoice without VAT before being included in the register, Hacienda could argue that the transaction did not meet the requirements for not charging the tax and demand Spanish VAT on that invoice from her, with a surcharge or a penalty depending on the case. Recovering it from the client afterwards is not always possible. The prudent course is not to invoice European businesses without VAT until inclusion has been confirmed, or to agree with the client an invoicing date that fits the time limit for a decision.
If you are starting out and already know you will have clients in other member states, you can say so in the self-employed registration form so that the ROI application goes in the same 036 as the registration.
The Modelo 349 that comes afterwards
Being in the ROI creates an additional reporting obligation: Modelo 349, the recapitulative statement of intra-Community transactions. It lists, by client and period, the services supplied to businesses in other member states. The tax administrations of the Union cross-check that information with what the clients declare, so a transaction that Clara declares and her client does not, or the other way round, can lead to questions in either country.
How often Modelo 349 is filed depends on the volume of transactions, and it is filed only for periods in which there are transactions to report. For Clara, if the Rotterdam client is her only intra-Community transaction in the quarter, she will file a 349 with a single line.
What the ROI does not tell you
Inclusion in the ROI settles the Spanish side. It does not settle whether your client has any additional obligation in its own country, or whether the transaction has tax consequences there beyond the VAT the client self-assesses. We do not give opinions on the law of the client's country: those questions must be confirmed with its adviser in that state.
Nor should you forget that IRPF withholding (Spanish personal income tax) does not apply to non-resident clients without an establishment in Spain, which affects your instalment payments. If a large part of your income comes from abroad, you will probably have to file Modelo 130 every quarter.
The guide on registering in the ROI and VIES sets out the procedure and the documents in more detail. If your question is how to choose the heading for an activity provided mainly to foreign clients, see what the IAE heading is.
At Salama Tax we include the ROI application when the activity requires it and prepare Modelos 303 and 349 for each period, cross-checking the invoices issued against the VIES checks so that both forms match.