Is VAT registration needed for doing business with Spain?

[AliWade]

If you are doing business with a company in Spain, do you need to be VAT-registered? (Asking on behalf of a VA, so she is providing admin services.)

Thanks.

 

[Scalloway]

From here

https://www.avalara.com/vatlive/en/country-guides/europe/spain/spanish-vat-registration.html

There is no VAT registration threshold for non-resident companies providing taxable supplies in Spain. There is a €35,000 per annum threshold for foreign companies selling goods to Spanish consumers via the internet.

 

[NLondonTranslator]

FWIW, anecdotally from what I have heard from other translators doing business with companies in Spain, it does seem to be a popular misconception in Spain that you do need a (UK) VAT number in order to be categorised as a business transaction not a consumer transaction. Can be a bit of a pain for self-employed folks who are well under the UK threshold to persuade Spanish clients that everything is legit.

 

[Andy777]

No, you don't need to be VAT registered to deal with a company in Spain OR any company in any EU country.

Sometimes you have to educate such companies on how EU trade works between countries, how VAT is dealt with etc., but they should not request that you're VAT registered, it does not make any difference to them.

 

[stefano_adversaria]

Yes, you need to be VAT registered if you want to do business outside your country, buy you are not going to charge VAT from b2b business.

 

[DontAsk]

Yes, you need to be VAT registered if you want to do business outside your country, buy you are not going to charge VAT from b2b business.

Did you bother reading the previous replies before posting yours?

Which do you think are incorrect?

 

[stefano_adversaria]

Yes I do bother reading the replies.

To respond to the first question (as I understood it):
If you are a company and you want to deal with other companies in Europe you need to be VAT registered. Being VAT registered do not mean that you need to charge VAT.

 

[Deleted member 59730]

If you are a company and you want to deal with other companies in Europe you need to be VAT registered.

NO! You do not need to be registered for VAT.

 

[DontAsk]

As per the other replies, which you seem to disagree with, you do not need to be VAT registered (unless you are above the threshold for mandatory registration) to do business within the EU.

 

[NLondonTranslator]

Yes, you need to be VAT registered if you want to do business outside your country, buy you are not going to charge VAT from b2b business.

The second part of what you say is true, and is the cause of the misconception over the first part. The point is, those transactions need (as I said a few days ago) to be demonstrably business, not consumer, transactions for VAT not to be payable. So as you said, b2b. Because the VAT threshold in Spain is so low, almost every bona fide business in Spain is VAT registered. The problem then comes from the assumption by some in Spain that being a business means you have a VAT number, because that is how it works in Spain. Business = VAT number = business.

Not true in UK, of course. A company reg no should suffice for the purpose, if you are incorporated and if you can pursuade your Spanish contact of the truth of the matter in that the key attribute is "being a business" and not "having a VAT number" and that the 2 things are not one and the same.

For the self employed (which applies to most in my line of work), it can be more difficult to persuade people one is a business. I did hear that hmrc would issue a kind of "dummy" VAT number for people in this situation, but I don't know if that is true, or still the case.