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V3146-19 12 November 2019 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IVA · servicios prestados por vía electrónica

Advertising services and electronic book sales may be subject to VAT if effectively used in Spain

A professional seeks advice regarding VAT taxation on the leasing of advertising space, the sale of e-books to US platforms, and the transfer of copyrights to a Spanish publisher, as well as the deductibility of expenses for Personal Income Tax (IRPF). The Directorate-General for Taxes (DGT) rules that electronic services depend on their effective use in Spain and that the transfer of copyrights by authors constitutes both taxable and exempt operations.

The question raised

Taxation under Value Added Tax regarding the aforementioned transactions.

The DGT's ruling

The licensing of banners and the sale of e-books are services provided by electronic means. They shall not be subject to VAT if the recipient does not have a registered office in Spain, unless their effective use or exploitation in Spanish territory for the purpose of carrying out taxable transactions is demonstrated. The assignment of copyrights by authors is a transaction subject to and exempt from VAT. For Personal Income Tax purposes, expenses are deductible if they are correlated with income, justified, and recorded.

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