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V2521-20 23 July 2020 · SG de Impuestos sobre el Consumo Criterion in force
IVA · sujeción

Business advisory services outside the EU may be subject to VAT if their effective use is in Spain

A company has requested clarification on whether its communication advisory services provided to a Chilean company are subject to VAT. The DGT explains that although the general rule of location places the transaction outside Spain, the criterion of effective use and enjoyment may apply if the service is utilised within Spanish territory.

The question raised

Whether or not the described services are subject to Value Added Tax.

The DGT's ruling

Advisory services provided to a taxable person not established in the EU are not subject to VAT if their registered office is not in Spain. However, pursuant to Article 70.Two of Law 37/1992, they shall be subject to VAT if their effective use or exploitation takes place in Spanish territory. To this end, the service must be related, directly or indirectly, to transactions subject to VAT in Spain, whether the recipient is the end user or the service is reinvoiced and used within the national territory.

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