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V2392-16 1 June 2016 · SG de Impuestos sobre el Consumo Criterion in force
IVA · mediación

Mediation services for a Chinese agency may be subject to VAT if used for operations in Spain

A Spanish company provides mediation services to a travel agency in China to facilitate contact with tourism providers in Spain. The DGT examines whether these mediation services are subject to VAT, depending on whether the company acts on behalf of a third party or on its own account, and whether the effective use rule applies.

The question raised

Liability of the aforementioned operations for Value Added Tax.

The DGT's ruling

If the mediation is carried out on behalf of a third party, it is not subject to VAT if the recipient is a business located outside of Spain, unless the effective use rule under Article 70.Two applies. This rule requires that the service be used to carry out transactions subject to VAT in Spain by the Chinese entity. If the mediation is carried out on one's own account by selling access to shows, it will be subject to VAT if the event takes place in Spain, with rates of 10% or 21% depending on the type of event.

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