As it is already known, on July 1 took effect the increase of two of the three rates that have the VAT tax in Spain. Specifically, the standard rate of 16% is 18% and the reduce of 7% goes up to 8%. The super-reduced rate of 4% remains as it is.
But given the complexity of the levying of VAT rules and the existence of operations that can be rectified by negative invoices to be made after July 1 we will give some guidelines in order to know how to react to this legislative change, as already indicated, is more complex than simply raise the tax 2 points. For the purposes of easier understanding we will use specific examples.
Advance payments to suppliers and subsequent delivery of the goods
Let us illustrate with the purchase of a car and two assumptions
Assumption a): I have clear the specific car that I want to buy:
In this case if we have made an advance payment of 90% of the car, the car dealer applies the 16% for being a down payment made in advance and when I get the car deliver on July 15, the car dealer only will tax 18% on 10% of the price that I have to pay, without having to correct upwards 16% of VAT paid in advance
Assumption b): I have not clear which model is the one I want:
In this case when I make a prepayment on account of a generic list of products from which I can freely choose what I want, then I'm not in the same situation as if a) and the tax rate paid to 16% when I made the advance payment, will need to be correct to 18% when I finally get delivered the car that I finally decided, since it is understood that in such situations is not really an advance payment. It is also a way to avoid fraud and cunning.
VAT rate to apply in the event of subsequent rectification of the tax base for whatever reason
We have agreed that the VAT is levied at a specific time and that the tax rate applicable is the rate at this point in time, when from 1 July to make a rectification of an invoiced which display 16% or 7%, the amendment invoice has to display to the same tax rates that had the bill corrected, although the operation of rectification was made after July 1.
VAT rate to apply on the supply and continued operations in time
:For example: mobile phone services: As well known mobile bill in July take part of June and part of July. If we followed the general rule for levying the VAT mobile companies should separate calls that were made until June 30 and charge them to 16% and those made from 1 July onwards 18%, but in this type of general supply contracts levyingl rule is set when the obligation to pay arise, so if the invoice is made in July and is due to in July everything will be 18%, even though might be calls made during the month of June.
Telephone services using prepaid card, in this case lies chargeability when purchasing the card regardless of when I consume the minutes I bought with the acquisition of the card, that is, if I buy the card on June 25 the VAT to 16% even though I made the calls for the month of July.
Serveco Asesores
www.serveco.es
Antonio Robles Jara