Non-resident companies selling via digital platforms retain the right to deduction
Companies not established in the European Union that operate by selling goods through digital platforms in Spain benefit from a specific tax treatment that guarantees the recovery of their costs. The Dirección General de Tributos (DGT) has recently clarified the treatment of these operations and the formal obligations that sellers must fulfill.
What the DGT has resolved
The tax authority has determined that the supplies of goods made by a trader not established in the Community to a digital interface are considered taxable and exempt operations, in accordance with Article 20.bis of Law 37/1992. As this is a full exemption, these operations generate the right to VAT deduction.
Regarding formal obligations, the resolution establishes the following points:
- Invoicing: The seller must issue invoices identifying the digital interface as the recipient of the transaction.
- Mention of the exemption: It is mandatory to mention the corresponding exemption on the commercial document.
- Tax return: In Form 303, these operations must be recorded in a way that reflects their status as generators of the right to deduction.
- Immediate Supply of Information (SII): The registration rules and applicable codes according to current regulations must be observed.
What it means for you
If your company is not based in the European Union and uses digital platforms to market goods in Spanish territory, these sales do not prevent you from recovering the VAT incurred in your activities. The classification of the operation as a full exemption is a determining factor in preventing the tax from becoming an additional cost for the business.
What you should do
It is necessary to ensure that invoicing processes are correctly configured to identify the digital interface as the actual customer of the transaction. Likewise, the management of the VAT return must align with this criterion to avoid errors in the reporting of taxable bases and in the application of deduction codes in Form 303. It is recommended to assess the particular situation of each business model to guarantee compliance with registration and information supply obligations.
Frequently asked questions
- Do non-resident companies selling through platforms have the right to deduction?
- Yes, as it is a full exemption according to Article 20.bis of Law 37/1992, they generate the right to deduction.
- To whom should the invoice issued by the seller be addressed?
- The invoice must identify the digital interface as the recipient of the supply of goods.