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V0388-21 25 February 2021 · SG de Impuestos sobre el Consumo Criterion in force
IVA · dropshipping

Dropshipping via online sales is subject to VAT and the equivalence surcharge regime

An individual in the Canary Islands has requested a ruling regarding the taxation of their dropshipping activity. The DGT has determined that such sales are subject to VAT and that, by acting as a retail trader, the individual must be subject to the equivalence surcharge regime.

The question raised

1. Taxation of the activity by Value Added Tax.

The DGT's ruling

The activity of selling products via the internet constitutes a business activity subject to VAT. Two deliveries are distinguished: that from the supplier to the applicant and that from the applicant to the final customer. As it is a retail trade activity, the applicant must bear the VAT and the equivalence surcharge on its purchases. If this is its sole activity, it shall not be entitled to deduct the tax amounts incurred in its acquisitions.

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