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V2108-24 27 September 2024 · SG de Impuestos sobre el Consumo Criterion in force
IVA · establecimiento permanente

VAT on food supplement sales from the Canary Islands to mainland Spain and the EU depends on the recipient

A Canary Islands company has requested clarification regarding VAT on the online sale of food supplements to customers in mainland Spain and the EU. The DGT clarifies that the use of logistics services does not constitute a permanent establishment and details the rules of localization based on whether the customer is a taxable person or a final consumer.

The question raised

Whether the operations consulted are subject to Value Added Tax and, where applicable, the applicable tax rate and reporting obligation.

The DGT's ruling

The consultant is a business owner and their sales are subject to VAT. If they sell to businesses in the peninsula, it is an intra-territorial supply subject to Spanish VAT (with reverse charge if they do not have a permanent establishment). If they sell to other Member States, these are intra-Community supplies exempt if the requirements of Article 25 are met. For final consumers in the EU, intra-Community distance selling rules apply, taxing at origin until the threshold of 10,000 euros is exceeded.

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