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A professional inquired whether performing a show in the Canary Islands for a company established within the tax territory is subject to VAT. The DGT ruled that, as the recipient is a business based in said territory, the service is deemed to be provided within the scope of the tax.
Question raised: Liability for Value Added Tax.
The provision of services is understood to be carried out within the territory to which the tax applies when the recipient is an entrepreneur or professional acting as such and has the registered office of their economic activity in said territory. This applies regardless of where the provider is established or the place from which the service is provided. In this case, as the recipient is a company established in the territory to which the tax applies, the service is subject to VAT.
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