Catering and restaurant businesses must use different IAE headings depending on the place of consumption

The correct determination of economic activities is a critical aspect of tax compliance for restaurant businesses. A recent resolution from the Dirección General de Tributos (DGT) establishes the criteria for registration in the Economic Activities Tax (IAE) when a business combines the provision of services in its establishment with the sale of products for external consumption.

What the DGT has ruled

The advisory body has specified that the nature of the activity determines the IAE heading. Specifically, the following distinctions have been established:

• Consumption on-site: If the activity is carried out within the establishment, it must be classified under groups 672 or 673, depending on the material nature of the service provided.
• Consumption off-site: For the sale of products intended to be consumed outside the premises, whether through collection at the establishment or home delivery, the activity must be registered under heading 677.9.
• Complementary activities: If the business independently carries out advertising or sponsorship activities, it must additionally register under group 844.

Furthermore, the DGT clarifies that the existence of an exclusivity contract with a specific brand does not have the capacity to alter the classification of the described activities.

What this means for you

For companies in the restaurant sector, this implies that a single IAE registration is not sufficient if their business model is hybrid. If your establishment offers both table service and the sale of products for takeaway or home delivery, the registration structure must reflect both realities separately to avoid errors in the declaration of activities.

What you should do

It is necessary to conduct an analysis of the operating model to ensure that each revenue stream is linked to the correct heading. You should verify whether the delivery or takeaway activity is duly registered under heading 677.9 and whether, in the case of performing marketing or sponsorship actions, the registration in group 844 has been completed. Each particular situation must be evaluated to guarantee the adequacy of the declared activity before the Administration.