Hospitality tax adviser: tax efficiency in Spain's most dynamic sector

The hospitality and tourism sector has specific tax characteristics that a generalist adviser does not always manage optimally. The simplified income assessment (módulos) for small establishments, the differentiated VAT rates (accommodation at 10%, catering at 10%, alcoholic beverages at 21%), the taxation of gift vouchers and loyalty bonds, the special VAT regime for travel agencies (REAV), and the tax management of the seasonal close are all sector-specific elements that require an adviser with dedicated knowledge.

Since 2010 · 16 years Tax agent AEAT

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Why BM Consulting

Specialised advice and personal service

At BMC we advise hotels, restaurants, catering chains, resorts, travel agencies, and tour operators on all tax aspects of their activity: determining the most efficient tax regime, managing hospitality VAT and the REAV, planning Corporate Income Tax and the self-employed hospitality operator's IRPF, and optimising group tax planning for hotel chains.

  • Hospitality VAT rates

    accommodation 10%, food/non-alcoholic beverages 10%, alcoholic beverages 21% (even served in restaurant), wellness/spa services 21% (or 10% if therapeutically oriented) — incorrect itemisation at point of sale is the most common source of sector reassessments.

  • Travel Agency Special VAT Regime (REAV) applies when travel services are purchased from third parties and resold to travellers — VAT is calculated on the margin, not the full price; the boundary between REAV and standard regime transactions is technically complex and closely monitored by AEAT.

  • Gift vouchers and loyalty points in hospitality

    single-purpose vouchers (fixed VAT rate) trigger VAT at point of sale; multi-purpose vouchers trigger VAT at redemption; points programmes have complex treatment depending on whether points carry a euro equivalent or only entitle to a discount.

  • Seasonal ERTE requires genuine causal justification (seasonal demand variation is not automatically accepted) — the Social Security contribution exemptions (up to 85% for agreed ERTE workers) provide significant cost savings for summer/winter peak businesses.

How we work

From first contact to case completion

  1. Optimal tax regime analysis

    For each hospitality establishment, we determine whether the simplified income assessment (módulos) or actual-cost assessment is more advantageous under IRPF, and whether standard VAT or the travel agency special regime applies depending on the nature of the activity.

  2. Hospitality VAT management

    We manage the complexity of hospitality VAT: differentiated rates by service type (accommodation, catering, beverages, excursions, spa), treatment of mixed packages, VAT on services provided to tour operators, and the travel agency special regime.

  3. Corporate Income Tax planning for hotel groups

    For groups with multiple establishments, we design the corporate structure and internal pricing policy to optimise group Corporate Income Tax: fiscal consolidation where applicable, efficient allocation of central management costs, and Corporate Income Tax optimisation at the group parent level.

  4. Seasonal cycle tax management

    The hospitality sector has marked seasonality that must be managed from a tax perspective: planning Corporate Income Tax instalment payments to avoid cash flow pressure in the low season, managing negative tax bases in loss years, and planning seasonal ERTEs to minimise their tax cost.

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The problem

The hospitality and tourism sector has specific tax characteristics that a generalist adviser does not always manage optimally. The simplified income assessment (módulos) for small establishments, the differentiated VAT rates (accommodation at 10%, catering at 10%, alcoholic beverages at 21%), the taxation of gift vouchers and loyalty bonds, the special VAT regime for travel agencies (REAV), and the tax management of the seasonal close are all sector-specific elements that require an adviser with dedicated knowledge.

Our solution

At BMC we advise hotels, restaurants, catering chains, resorts, travel agencies, and tour operators on all tax aspects of their activity: determining the most efficient tax regime, managing hospitality VAT and the REAV, planning Corporate Income Tax and the self-employed hospitality operator's IRPF, and optimising group tax planning for hotel chains.

Process

How we do it

1

Optimal tax regime analysis

For each hospitality establishment, we determine whether the simplified income assessment (módulos) or actual-cost assessment is more advantageous under IRPF, and whether standard VAT or the travel agency special regime applies depending on the nature of the activity.

2

Hospitality VAT management

We manage the complexity of hospitality VAT: differentiated rates by service type (accommodation, catering, beverages, excursions, spa), treatment of mixed packages, VAT on services provided to tour operators, and the travel agency special regime.

3

Corporate Income Tax planning for hotel groups

For groups with multiple establishments, we design the corporate structure and internal pricing policy to optimise group Corporate Income Tax: fiscal consolidation where applicable, efficient allocation of central management costs, and Corporate Income Tax optimisation at the group parent level.

4

Seasonal cycle tax management

The hospitality sector has marked seasonality that must be managed from a tax perspective: planning Corporate Income Tax instalment payments to avoid cash flow pressure in the low season, managing negative tax bases in loss years, and planning seasonal ERTEs to minimise their tax cost.

Hospitality taxation: more complex than it appears

Hospitality seems straightforward from the outside, but its tax treatment has a complexity that surprises those who encounter it for the first time. The differentiated VAT rates by service type, the Travel Agency Special Regime, the taxation of mixed accommodation and service packages, and the seasonal tax management are all elements that require an adviser with specific sector knowledge.

At BMC we advise hospitality establishments of all sizes: from the family restaurant assessing whether módulos are the best option to the hotel group with several properties that needs to optimise its tax position at group level. We know the sector, its seasonal rhythms, and its tax particularities.

Hospitality VAT: rates, invoices, and pro-rata

VAT is the tax that generates the most daily management burden in a hospitality establishment. The multiplicity of rates applicable to different services — 10% for accommodation and catering, 21% for alcoholic beverages, mixed rates on combined packages — demands careful management of invoicing and point-of-sale systems so that the rates applied are correct.

When the establishment provides services at different VAT rates or combines taxable with exempt services, the VAT recovery pro-rata is an additional complexity. The special pro-rata may be more advantageous than the general pro-rata for establishments with clearly distinct activities.

Travel agencies and tour operators: the REAV

Travel agencies and tour operators that purchase travel services from third parties for resale to the client may apply the Travel Agency Special VAT Regime (REAV), under which VAT is calculated on the margin rather than the total sale price. This regime greatly simplifies VAT management in transactions where the operator combines services from multiple suppliers with different VAT rates.

The boundary between transactions to which REAV applies and those subject to the standard regime is a technical matter that the AEAT monitors closely in the sector. We advise on the correct application of REAV and on documentation of transactions so that they are defensible under inspection.

Hotel groups: tax planning at group level

For groups with several hotels or establishments, tax planning must be conducted at group level: where profit is located, how central management costs are allocated, whether fiscal consolidation applies, and how overall tax is optimised — maximising instalment payments in good years and utilising carry-forward losses from poor years.

AEAT inspection priorities in the hospitality sector

The AEAT’s hospitality sector inspection programme targets several recurring non-compliance areas. Understanding these priorities allows operators to manage compliance proactively:

Cash transaction compliance. Hospitality is the sector with the highest proportion of cash revenue in the Spanish economy, and the AEAT cross-references cash transactions against POS terminal data, employee Social Security contributions, and food and beverage purchase invoices. The €1,000 professional cash payment limit (Ley 7/2012, amended) does not apply to consumer transactions — but operators who accept above-threshold payments from business clients (corporate events, group bookings billed to companies) are at risk. AEAT’s Verificaciones Tributarias programme systematically cross-references hospitality revenues against the tax returns of the businesses that claim them as deductions.

Módulos inconsistency. The AEAT has access to data from food and beverage suppliers, Mercado de Abastos wholesalers, and utility companies that allow them to cross-reference the consumption profile of an establishment against the income declared under the módulos regime. An operator declaring €30,000 under módulos while purchasing €40,000 in food and drink from traceable suppliers is generating an obvious inconsistency. Operators who believe they are below the módulos exit threshold should model their actual income against their purchase profile.

Tip reporting. Since the 2021 reform of the IRPF rules, tips paid electronically (via POS terminals or bank transfers) are reportable income for employees. Operators who process electronic tips must include them in payroll and submit them in the annual Modelo 190 withholding summary. Cash tips remain technically reportable but practically impossible to enforce. The transition to predominantly electronic payments post-COVID has brought tip reporting into focus.

Corporate Income Tax planning for hospitality operators

For operators structured as companies (not sole traders), the Corporate Income Tax planning toolkit offers significant opportunities:

Capitalisation reserve (Art. 25 LIS). Retaining profits in the company and transferring them to a restricted reserve generates a 10% CIT deduction. For a hotel company retaining €500,000 to fund a renovation programme, this equates to a €50,000 CIT saving in the year of reservation.

Equalisation reserve (Art. 105 LIS). SME hotels with turnover below €10 million can add a further 10% deduction — creating a combined 20% deduction potential on retained profits reinvested in the business.

Energy efficiency investment deductions. Law 13/2023 introduced enhanced deductions for qualifying energy efficiency investments — 30-40% deduction rate depending on the certification improvement achieved. Hotel groups investing in HVAC upgrades, LED lighting, and building insulation as part of their ESG and cost reduction programmes can access these deductions while reducing their energy bills.

Tourist accommodation platforms and the digital economy

Hotels and apartment operators who distribute through platforms like Booking.com, Airbnb, and Expedia face specific VAT and income tax compliance obligations that have evolved significantly over the past five years:

DAC7 reporting. Since 2023, digital platforms must report to national tax authorities the income earned by sellers and service providers through their platforms. For short-term rental operators, this means the AEAT receives automatic reports of platform-declared rental income — which it can cross-reference against Modelo 210 (for non-residents) or IRPF/CIS filings (for residents). Operators who have not been declaring all platform income should consider voluntary regularisation before an AEAT verification is triggered.

Platform economy VAT. Hotels and tourist apartments distributing through OTAs must correctly determine who is the VAT payer in the supply chain — the operator or the platform. Most OTAs act as intermediaries (not principals) in the EU, meaning the operator is the VAT-registered supplier and must account for Spanish VAT on the full accommodation price, with the platform charging its commission separately. However, for accommodation operators using certain platform commercial arrangements, the deemed-supplier rules may apply, requiring the platform to account for VAT.

Seasonal employment: Social Security and fixed-discontinuous contracts

Hospitality operators with seasonal businesses — beach restaurants, ski resort accommodation, summer rental properties — face specific employment compliance requirements under the 2022 labour reform:

The fixed-discontinuous contract (contrato fijo-discontinuo) is now the standard vehicle for seasonal recurring employment: the employment relationship is permanent but activated only when the season begins. Workers accumulate seniority continuously and have social security protection (desempleo discontinuo) during the off-season, while the operator avoids the severance costs of seasonal hiring and firing.

ERTE on productivity grounds for seasonal closures requires genuine procedural compliance — a seasonal closure ERTE must have genuine causal justification (insufficient demand, seasonal supply chain interruption) and be negotiated with employee representatives or, where no works council exists, with direct worker consultation. The Social Security contribution exemptions available during an agreed ERTE (up to 85% for companies that maintain employment) are a significant cost saving for seasonal operators.

What comes next

FAQ

Frequently asked questions

Hospitality services carry differentiated VAT rates: accommodation in hotels and similar tourist apartments is taxed at 10%; catering (food and non-alcoholic beverages) is taxed at 10%; alcoholic beverages (beer, wine, spirits) are taxed at 21% even if consumed in the restaurant; organised tourist excursions and activities are taxed at 10%; and spa, massage, and wellness services are taxed at 21% if purely aesthetic or 10% if therapeutically oriented. Correct classification of each type of service and itemisation on the invoice are critical to avoid reassessments.
The REAV is a special VAT regime that applies when a business (travel agency, tour operator, or in certain circumstances a hotel) purchases travel services from third parties and resells them to the traveller. Under REAV, VAT is calculated on the margin (the difference between the price charged to the client and the cost of the services purchased from third parties) rather than on the full invoice amount. The REAV simplifies VAT management on these transactions but has specific rules about which services are included.
Yes, restaurants and hotel establishments of a certain size may apply simplified income assessment for IRPF (if the owner is an individual) or the simplified VAT scheme. The módulos applicable to the hospitality sector take into account the number of tables, the category of the premises, floor area, and the number of employees. It is a simpler regime than actual-cost assessment but may not be the most efficient for establishments with high actual costs or marked seasonal inactivity.
The VAT treatment of gift vouchers and bonds in hospitality depends on their nature. If the voucher is single-purpose (entitlement to a specific service with a defined VAT rate), VAT is triggered at the time of sale. If it is multi-purpose (can be used for services with different VAT rates), VAT is triggered at the time of redemption. For Corporate Income Tax or IRPF purposes, income is generally recognised when the service is provided or, if the voucher expires unused, at the time of expiry.
Selling a hotel can be structured in two ways with very different tax consequences: as an asset sale (the hotel as real estate and as a going concern) or as a share sale of the company that owns it. An asset sale is subject to VAT or Transfer Tax depending on the nature of the assets and the vendor's status, with the gain taxed under Corporate Income Tax. A share sale may be VAT-exempt, with the gain also taxed under Corporate Income Tax but potentially qualifying for the Article 21 CIT exemption if the conditions are met. The choice of structure determines the overall tax cost and should be analysed in advance.
Hospitality businesses with marked seasonality — ski resorts, beach hotels, summer-only restaurants — face a cash flow mismatch in the standard Corporate Income Tax instalment payment system. Modelo 202 instalments are due in April, October, and December. For a seasonal business that generates most income in summer, an October instalment based on prior-year results may be disproportionately large relative to the current year's cash position. Businesses with turnover below €6 million can opt for the percentage-of-result modality, where instalments are calculated on the actual current-year profit — a significantly better cash flow outcome for seasonal operators. BMC selects and models the optimal instalment method annually for each hospitality client.

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Frequently asked questions

Questions about Tax Adviser for Hospitality and Tourism

Hospitality services carry differentiated VAT rates: accommodation in hotels and similar tourist apartments is taxed at 10%; catering (food and non-alcoholic beverages) is taxed at 10%; alcoholic beverages (beer, wine, spirits) are taxed at 21% even if consumed in the restaurant; organised tourist excursions and activities are taxed at 10%; and spa, massage, and wellness services are taxed at 21% if purely aesthetic or 10% if therapeutically oriented. Correct classification of each type of service and itemisation on the invoice are critical to avoid reassessments.
The REAV is a special VAT regime that applies when a business (travel agency, tour operator, or in certain circumstances a hotel) purchases travel services from third parties and resells them to the traveller. Under REAV, VAT is calculated on the margin (the difference between the price charged to the client and the cost of the services purchased from third parties) rather than on the full invoice amount. The REAV simplifies VAT management on these transactions but has specific rules about which services are included.
Yes, restaurants and hotel establishments of a certain size may apply simplified income assessment for IRPF (if the owner is an individual) or the simplified VAT scheme. The módulos applicable to the hospitality sector take into account the number of tables, the category of the premises, floor area, and the number of employees. It is a simpler regime than actual-cost assessment but may not be the most efficient for establishments with high actual costs or marked seasonal inactivity.
The VAT treatment of gift vouchers and bonds in hospitality depends on their nature. If the voucher is single-purpose (entitlement to a specific service with a defined VAT rate), VAT is triggered at the time of sale. If it is multi-purpose (can be used for services with different VAT rates), VAT is triggered at the time of redemption. For Corporate Income Tax or IRPF purposes, income is generally recognised when the service is provided or, if the voucher expires unused, at the time of expiry.
Selling a hotel can be structured in two ways with very different tax consequences: as an asset sale (the hotel as real estate and as a going concern) or as a share sale of the company that owns it. An asset sale is subject to VAT or Transfer Tax depending on the nature of the assets and the vendor's status, with the gain taxed under Corporate Income Tax. A share sale may be VAT-exempt, with the gain also taxed under Corporate Income Tax but potentially qualifying for the Article 21 CIT exemption if the conditions are met. The choice of structure determines the overall tax cost and should be analysed in advance.
Hospitality businesses with marked seasonality — ski resorts, beach hotels, summer-only restaurants — face a cash flow mismatch in the standard Corporate Income Tax instalment payment system. Modelo 202 instalments are due in April, October, and December. For a seasonal business that generates most income in summer, an October instalment based on prior-year results may be disproportionately large relative to the current year's cash position. Businesses with turnover below €6 million can opt for the percentage-of-result modality, where instalments are calculated on the actual current-year profit — a significantly better cash flow outcome for seasonal operators. BMC selects and models the optimal instalment method annually for each hospitality client.
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