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V0729-21 26 March 2021 · SG de Impuestos sobre el Consumo Criterion in force
IVA · uso y explotación efectiva

VAT liability for foreign entity management services depends on effective use or exploitation in Spain

A Spanish company provides registration and tax declaration filing services to a UK entity. The DGT assesses whether these services are subject to VAT under the rule of effective use or exploitation in Spain.

The question raised

Whether such provisions of services are subject to Value Added Tax as of January 1, 2021.

The DGT's ruling

Management and advisory services provided to entities outside the Community may be subject to VAT if their effective use or exploitation takes place in Spanish territory. To apply this, it must be verified that the operations related to the service are carried out in Spain and that there is a direct or indirect relationship between the service and said operations. The determination of this effective use is a matter of fact that must be proven on a case-by-case basis.

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