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V3115-18 30 November 2018 · SG de Impuestos sobre el Consumo Criterion in force
IVA · dropshipping

Dropshipping sales without physical entry of goods into Spain are not subject to VAT

A dropshipping company has requested a ruling regarding the VAT liability of products shipped directly from China or Germany to the customer. The Directorate-General for Taxes (DGT) has ruled that if the goods do not physically enter Spain, the transaction is not subject to the tax.

The question raised

Liability for Value Added Tax on the sale of such products when the recipients are in third countries or territories, the Community, or in the territory of application of the Tax.

The DGT's ruling

If the company purchases goods outside of Spain and there is no physical transport of said goods towards the national territory, the operation is not subject to VAT as its accrual does not occur. Sales to customers in the EU or third countries carried out outside of Spain are also not subject to VAT. For sales to customers in Spain, if they originate from China, an import occurs; if they originate from the EU, intra-Community acquisition or the distance selling scheme applies if the requirements of Article 68.Three are met.

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