Lucía Ferrer is a product designer. She lives in Valencia and has been registered as an autónomo (a self-employed person in Spain) since 2023. In March 2026 she signed an assignment with a software company in Austin, Texas, worth 4,500 USD a month to redesign its app. At almost the same time, a private individual in Chicago who had seen her portfolio asked her to design the logo for his personal project for 800 €. She issued the first invoice without VAT because a colleague told her to; she does not know how to issue the second. And, deep down, she is not sure the first one is right either.
The two questions have different answers, and the difference lies not in the client's country but in who the client is.
The deciding question: a business or a private individual?
Spanish VAT applies only to transactions that the law treats as carried out within the territory where the tax applies. For services, the general rule is in article 69 of Law 37/1992, the Spanish VAT Law. Its section One distinguishes two cases:
- If the recipient is a business or professional, the service is located where that recipient has the seat of its business activity (or its permanent establishment or, failing that, its home address). The text adds that this applies "regardless of where the service provider is established and of the place from which it provides the services".
- If the recipient is not a business, the service is located where the provider is established.
Applied to Lucía: the Austin company has its seat in the United States, so the service is not treated as supplied in Spain and the invoice carries no Spanish VAT. This is not an exemption; it is a transaction outside the scope of the tax: Spanish VAT simply does not reach that far. The private individual in Chicago, on the other hand, is not a business, and the general rule points to the place where Lucía is established, which is Valencia.
The list that rescues some assignments for private individuals
For private individuals outside the European Union there is an important exception. Article 69.Two lists a series of services that are not treated as supplied in Spain when the recipient is not a business and has their home outside the Community. They include, for example, assignments of copyright and intellectual property rights, advertising, advisory work, consultancy and legal services, data processing and the supply of information, and translation.
That exception in turn has its own exception: it does not apply if the private individual lives in the Canary Islands, Ceuta or Melilla. We deal with that in how to invoice the Canary Islands, Ceuta or Melilla.
If Lucía's assignment consists, in essence, of assigning the exploitation rights to a logo, it can be argued that it fits letter a) of that list and does not carry Spanish VAT either. If what she supplies is something else that does not appear in the list, the general rule applies and the invoice carries Spanish VAT even though the client lives in Illinois. This is a classification worth documenting, because the line between "assigning rights over a work" and "supplying a design service" is not always clear, and the contract is the best evidence of which of the two was agreed.
| Client | Service | Spanish VAT? | Legal basis |
|---|---|---|---|
| Company with its seat in the US | Any, except special rules (property in Spain, for example) | No, outside the scope of the tax | Art. 69.One.1 of the VAT Law |
| Private individual in the US | Included in the art. 69.Two list (copyright, consultancy, translation…) | No | Art. 69.Two of the VAT Law |
| Private individual in the US | Not included in that list | Yes, at the applicable rate | Art. 69.One.2 of the VAT Law |
| Private individual in the Canary Islands, Ceuta or Melilla | Included in the list | Yes, the exception does not apply | Art. 69.Two, final clause |
Lucía's figures, invoice by invoice
For the example we will use an exchange rate of 1 € = 1.08 USD. It is an assumed figure; in real life the rate used is the one for the day on which each invoice's tax point falls, as we explain in what exchange rate to use for an invoice in dollars.
- Monthly invoice to the Austin company: 4,500 USD.
- In euros: 4,500 ÷ 1.08 = 4,166.67 €.
- VAT charged: 0 €. The transaction is reported in Modelo 303, the quarterly VAT return, in the section for transactions not subject to the tax under the place-of-supply rules, with no tax due.
- Over the year (nine months of 2026): 4,166.67 × 9 = 37,500 € of business income for IRPF (Spanish personal income tax). Being outside the scope of VAT has no effect whatsoever on income tax: that money is taxed like any other income from her business.
Now the private individual in Chicago, in two scenarios:
- If the assignment is documented as an assignment of rights over the logo: 800 € with no Spanish VAT.
- If it is documented as a design service that does not fit the list: 800 € + 21 % = 968 €, and Lucía pays 168 € over to the tax office in her 303.
What she cannot do is charge 800 € "VAT included" without having thought about it. If it later turns out that VAT should have been charged, the base is worked out backwards from the price: 800 ÷ 1.21 = 661.16 € of base and 138.84 € of tax that comes out of her own pocket.
Adding Spanish VAT to an invoice for a company outside the Union is not the prudent option. If the transaction is outside the scope of the tax, that VAT has been charged improperly: the client will not be able to deduct it anywhere, it will usually refuse to pay it and you will have to correct the invoice. And if you collected it and paid it over, getting it back requires a correction procedure.
What to keep to prove where the client is
The rule in article 69.One.1 depends on a fact: that the recipient is a business and has its seat outside Spain. If Hacienda, as the Spanish tax office is commonly known, reviews your invoices without VAT, the burden of proving that fact is on you. With a company in the Union there is the VIES database to check it; with an American one there is no equivalent register to consult, so the evidence is built up from documents:
- The contract or purchase order signed by the company, with its full name and address.
- The company's US tax identification number (the EIN) or any other registration detail it has given you.
- Invoices issued in the name of the company, not the person who hired you.
- Proof of payment from an account in the company's name.
- Emails or documents showing that the assignment is for its business and not for the personal use of whoever signs.
With the private individual, the evidence runs the other way: their home address outside the Union, which is what allows the article 69.Two list to be applied.
The role of the invoice
An invoice without VAT to a company in Austin is still a complete invoice, with all the details that the Spanish invoicing regulations require. It should state why no VAT is charged, with a note along the lines of "transaction not subject to VAT under article 69.One.1 of Law 37/1992". Article 12 of the invoicing regulations allows amounts to be expressed in dollars, provided that the VAT, where there is any, is shown in euros.
These transactions do not go into Modelo 349: that summary return only covers transactions with businesses in other EU member states, and the United States is not one. They do appear in the 303, in the box for transactions not subject to the tax, and a 303 with high income and zero tax tends to attract attention if those boxes are left blank. We describe this in what happens if I file a nil 303.
What does not change even if VAT disappears
The fact that the invoice carries no VAT does not mean the American client will not ask you for paperwork. It is very likely to ask for a form certifying that you are not resident in its country; this is explained in I have been asked for a W-8BEN. And the full picture for an autónomo who invoices mainly to the United States, with payments on account and possible withholding there, is in I invoice clients in the United States.
If your case mixes businesses and private individuals, clients inside and outside the Union, or services and you do not know which letter of the list they fit, you can describe it in the form for self-employed people with international clients with a couple of sample invoices. The guide to where each service is taxed also covers the special rules, such as services connected with property, which displace the general rule.
The taxation of people who work from Spain for clients in other countries, with VAT, income tax and the information returns that cross-check one another, is brought together on the Salama Tax page for self-employed people with international clients.