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V2598-14 3 October 2014 · SG de Impuestos sobre el Consumo Criterion in force
IVA · mediación

Mediation services performed on behalf of others are subject to VAT, with location determined by the recipient

A professional sought clarification regarding the VAT treatment of intermediation services provided for hospitality contracting on behalf of hotels. The Spanish Tax Agency (DGT) ruled that these services are subject to VAT and that their place of supply depends on the recipient's registered office or residence.

The question raised

Liability for Value Added Tax on such services and, where applicable, the applicable tax rate.

The DGT's ruling

The inquirer is considered an entrepreneur or professional, therefore their mediation services are subject to VAT. By acting on behalf of and for the account of others, the special regime for travel agencies does not apply. The location of the supply is governed by the general rules: if the recipient is an entrepreneur, the service is deemed to be performed in the territory where they have their registered office or permanent establishment. The taxable base shall be the amount of the commission charged.

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