Travel agencies may apply VAT exemption for services outside the EU

The management of tourist packages under the special regime for travel agencies presents important nuances when accommodation or transport services are provided outside the territory of the European Union. The recent resolution from the Dirección General de Tributos (DGT) delimits how Value Added Tax (IVA) must be taxed in these intermediation operations.

What the DGT has resolved

The DGT establishes that accommodation and transport services, when provided in one's own name and using third-party means, are integrated into a single travel service under the special regime for travel agencies. The key point of the resolution lies in the location of said services:

• If the accommodation or transport services are carried out outside the European Community, the portion corresponding to these services will be exempt from IVA.
• When a tourist package combines services both inside and outside the European Union, the tax base (the gross margin) must be calculated by applying a proportionality criterion to determine the portion that is not subject to the tax.

This interpretation is based on Law 37/1992 on Value Added Tax.

What it means for you

If your company acts as an intermediary organizing trips or accommodation and transport services in its own name, this criterion directly impacts the determination of your tax base. The ability to apply a partial exemption to services provided outside the EU allows for a correct delimitation of the tax burden on the gross margin obtained.

For companies in the sector, this implies that the nature of the service (transport or accommodation) and its geographical location are decisive for the application of the exemption. The mere existence of a tourist package is not enough; it is necessary to break down the part of the service that is carried out outside the territorial scope of the European Union to apply the corresponding proportionality.

What should be done

It is necessary to analyze the structure of the tourist packages marketed by the company to identify which accommodation and transport components are executed outside the EU. The correct application of the proportionality criterion to the gross margin is fundamental to avoid errors in the IVA settlement. It is recommended to assess each operation individually to ensure that the exemption is applied only to the part of the service that meets the legal requirements.