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V0179-19 29 January 2019 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IVA · servicios de enseñanza

Online language classes may be exempt from VAT if part of the school curriculum

A professional asks whether VAT should be applied to her online Spanish classes and her registration in the IAE, as well as IRPF retention for services provided to a French company. The DGT states that VAT exemption depends on whether the subject is part of the curriculum and the nature of the service provided.

The question raised

To determine whether VAT must be applied to invoices, in addition to registering for the corresponding Business Activities Tax.

The DGT's ruling

Language classes taught by a teacher via the internet are teaching services and not services provided by electronic means. They shall be exempt from VAT if the subject is included in the educational system's curricula and the activity is professional (not business). Customer maintenance services provided to a French company are not subject to VAT due to the application of the general rule of location. Regarding Personal Income Tax (IRPF), the French company shall only be obliged to withhold tax if it operates in Spain with a permanent establishment or if the income constitutes a deductible expense according to non-resident regulations.

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