Updated for 2026

Complete Guide to VAT for Freelancers and Businesses

Master Value Added Tax in Spain. From calculating output VAT to the latest updates on the SII system and mandatory quarterly forms for this 2026.

VAT management and accounting

Information based on official sources

AEAT Social Security Ministry of Finance BOE

What is VAT and why is it vital for your business?

Value Added Tax (VAT) is an indirect tax on consumption. Unlike IRPF, which taxes personal income, VAT applies to the delivery of goods and provision of services. As a freelancer or business, your role is not to pay the tax out of your own pocket, but to act as an intermediary collector for the Tax Agency.

Output VAT (IVA Repercutido)

This is the VAT you charge your clients on your invoices. This money belongs to the Treasury and you must set it aside for quarterly settlement.

Input VAT (IVA Soportado)

This is the VAT you pay to your suppliers for goods or services necessary for your economic activity. It may be deductible.

Final Settlement

The difference (Output - Input) determines if you must pay the Treasury or if you are entitled to a refund or offset.

Tax Rates in Spain 2026

21%

Standard Rate

This is the default percentage applied to most products and services: clothing, footwear, electronics, professional consulting services, tobacco, alcohol, and much more.

10%

Reduced Rate

Applicable to food in general, passenger transport, hospitality, and tickets for museums or cultural shows.

4%

Super-reduced Rate

Reserved for essential items: bread, milk, eggs, fruits, vegetables, books, and medications.

VAT Exemptions

Certain activities such as official education, public health care, and insurance are exempt from applying VAT on their invoices.

Consult specific cases →

VAT and Tax Simulator

Use our calculator to break down your invoices. Includes the option for Equivalence Surcharge for retailers and IRPF retention for self-employed professionals.

VAT Amount 210.00 €
IRPF Retention (-) 0.00 €
Invoice Total 1,210.00 €

Note: This calculation is for guidance only. For official filings, consult one of our recommended consultancies.

Tax Calendar and Forms

VAT management requires precision. Failing to file forms on time can lead to penalties of up to 20% of the amount due.

Important: Since 2025, electronic invoicing is mandatory for all B2B relations in Spain.

303 Form 303: Quarterly Self-Assessment

This is the main form. All freelancers and companies (except special regimes) must file it every quarter to declare collected VAT and deduct paid VAT.

  • 1st Quarter: April 1st to 20th.
  • 2nd Quarter: July 1st to 20th.
  • 3rd Quarter: October 1st to 20th.
  • 4th Quarter: January 1st to 30th of the following year.

390 Form 390: Annual Summary

It is an informative declaration that summarizes all operations of the year. It is filed in January alongside the fourth quarter Form 303. Although it does not involve payment, its omission is sanctionable.

SII Immediate Supply of Information (SII)

Mandatory for large companies (turnover > €6M) and VAT groups. It consists of electronically sending billing records within 4 calendar days to the Electronic Office of the AEAT.

Special VAT Regimes

Equivalence Surcharge

Special for self-employed retailers who sell to the final customer. In this regime, the freelancer pays a slightly higher VAT to their supplier, but in return does not have to file VAT returns to the Treasury or keep record books.

21% VAT

+5.2% Surcharge

10% VAT

+1.4% Surcharge

Simplified Regime (Modules)

Applicable to certain activities (small shops, workshops, agriculture). Instead of calculating real VAT, a fixed fee is paid based on indicators or "modules" such as employed staff, contracted electrical power, or the square footage of the premises.

Check if your activity can enter modules →

Intra-community VAT (VIES)

If you buy or sell services to other European Union countries, you can benefit from the reverse charge mechanism. To do this, you must be registered in the ROI (Registry of Intra-community Operators) via Form 036.

Special Territories: IGIC and IPSI

The Canary Islands, Ceuta, and Melilla do not apply common VAT. Instead, they use IGIC (Canary Islands) or IPSI (Ceuta and Melilla), with tax rates generally lower than the mainland territory.

IGIC: 7% Standard IPSI: 0.5% - 10%

How to avoid errors in your VAT declaration

Common Errors

  • ✕ Deducting non-business expenses: You cannot deduct VAT for personal food or clothing purchases if they are not a specific uniform.
  • ✕ Receipts vs. Invoices: A receipt (simplified invoice) is often not enough to deduct VAT; you need a full invoice with your freelancer details.
  • ✕ The shared car: The Treasury usually only allows a 50% deduction of VAT for a vehicle unless you prove 100% professional use.

Best Practices

  • ✓ Separate VAT pot: Keep a savings account where you put 21% of each invoice collected so you don't spend it.
  • ✓ Certified Digitalization: Use invoicing software that complies with the "Crea y Crece" Law to automate your record books.
  • ✓ Review Cash Basis: If you have liquidity problems, you can choose to pay VAT only when you collect the invoice (Special Cash Accounting Regime).

Frequently Asked Questions about VAT

What happens if my input VAT is higher than my output VAT? ▼
Your settlement will result in "to be refunded" or "to be offset". Generally, the Treasury offsets this balance in the following quarters of the same year. Only in the fourth quarter can you request the actual refund of the money to your bank account.
Is a Digital Certificate mandatory for filing VAT? ▼
Yes, for most procedures with the AEAT in 2026. You can obtain it by following our guide to the Digital Certificate and Cl@ve.
Should I charge VAT to a client outside the EU? ▼
Normally not. Exports of goods and services outside the European Union are exempt from VAT in Spain (transaction not subject to localization rules), but you must declare the transaction for informational purposes.
What is the Apportionment Rule (Regla de Prorrata)? ▼
It applies when a freelancer simultaneously performs activities subject to VAT and exempt activities (e.g., a doctor who also sells online courses). The apportionment limits the percentage of input VAT that you can deduct based on the weight of your sales with VAT.
What is the deadline for rectifying an invoice with a VAT error? ▼
You have a period of 4 years from the tax accrual to issue a rectifying invoice and correct the error in your next declaration.

Need help with your taxes?

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