🇪🇸 Who Needs to Register for VAT in Madrid?
If you operate a business in Madrid and:
✅ Sell goods or services in Spain
✅ Invoice Spanish or EU-based clients
✅ Exceed the VAT exemption threshold
✅ Want to deduct input VAT on expenses
Then you must register for IVA (Impuesto sobre el Valor Añadido), Spain’s version of VAT.
📌 Even some foreign companies with no Spanish office may need VAT registration if selling into Spain.
📝 How to Register for VAT in Madrid
| Step | Details |
|---|---|
| Apply for CIF (Tax ID) | Done during SL company setup or autonomo registration |
| Form 036 | Used to register for VAT with AEAT |
| Choose VAT regime | General regime (most common) or simplified |
| Get SII code (optional) | For large taxpayers or special reporting |
💡 Madrid-based freelancers (autónomos) also register for VAT using Form 037 (simplified version of 036).
💸 VAT Rates in Spain (Madrid)
| VAT Type | Rate | Common Examples |
|---|---|---|
| General | 21% | Most services, goods, professional fees |
| Reduced | 10% | Transport, restaurants, hotels, cultural events |
| Super-reduced | 4% | Basic food, books, newspapers, medication |
📌 You must issue VAT invoices and declare VAT on both income and expenses.
📅 VAT Filing Deadlines in Madrid
| Period | Form | Deadline |
|---|---|---|
| Quarterly | Modelo 303 | Apr 20, Jul 20, Oct 20, Jan 20 |
| Yearly | Modelo 390 | Jan 30 |
| EU Sales | Modelo 349 | Monthly or quarterly, depending on volume |
All submissions must be done digitally via AEAT using a firma digital.
📦 Intra-EU VAT (VIES Registration)
If you trade with clients or suppliers in other EU countries, you must:
✅ Register with VIES (VAT Information Exchange System)
✅ Apply reverse-charge where applicable
✅ File Modelo 349 for intra-community operations
We handle your VIES inclusion and ongoing filings.
🧾 How VAT Works in Practice
| Example | VAT Applied | Action Required |
|---|---|---|
| Invoice to Spanish client | 21% | Charge and declare via Modelo 303 |
| Invoice to EU VAT-registered client | 0% (reverse charge) | Declare in Modelo 349 |
| Expense with Spanish provider | Includes VAT | Deductible if related to business |
| Foreign invoice (non-EU) | 0% | May trigger customs VAT obligations |
📌 Input VAT can only be reclaimed if the expense is tied to your declared activity and properly documented.
❌ Common VAT Mistakes in Madrid
⛔ Not registering for VAT when legally required
⛔ Using personal expenses as deductions
⛔ Late filing of Modelo 303 or 390
⛔ Ignoring EU transaction declarations
⛔ Incorrectly applying reverse charge rules
🧑💼 Our Madrid VAT Services
Borderless Lawyers offers:
✅ VAT registration via Form 036 / 037
✅ Filing of Modelo 303, 390, 349
✅ Invoicing system review and setup
✅ VIES and EU compliance support
✅ Tax representation for foreign-owned SLs
📞 Register and File VAT the Right Way in Madrid
Whether you’re a freelancer or a growing company, VAT compliance is essential for running a legal business in Madrid.
👉 Contact us to manage your VAT registration and filings in Madrid.