VAT and Spain

VAT and Spain

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A UK limited company with registered office in UK has Spanish shareholders and directors. The operate their company from Spain and provide IT services to Spanish customers (B2B).

If they breach the UK VAT registration threshold, do they need to register for VAT in the UK or should they be registering in Spain and complying with Spanish VAT rules?

Thanks in advance.

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By Lady Carrera
21st Dec 2015 11:16

Why would a company that is not making any supplies in the UK breach the UK VAT registration threshold?

Have you also considered the possibility that the company probably is not UK resident for Corporation Tax purposes either, so will still be liable to tax in Spain, despite the efforts of those involved to avoid Spanish tax, in favour of paying UK tax?

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RLI
By lionofludesch
21st Dec 2015 11:25

Spanish

The Spanish threshold is much lower too.

Is it not €1 ?  Happy to be corrected on that.

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Replying to lionofludesch:
By mrme89
21st Dec 2015 11:34

Threshold

lionofludesch wrote:

The Spanish threshold is much lower too.

Is it not €1 ?  Happy to be corrected on that.

 

There isn't one in Spain.

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By mrme89
21st Dec 2015 11:28

Thanks Lady C.

I looked at the establishment rules for making supplies in the UK. But it now transpires that the supplies are all in Spain – something I am not confident on the rules of. Your comment makes things more obvious now.

Presumably, both VAT and CT in the UK are irrelevant for this company. Making opening a UK company pretty pointless (although an easier exercise than opening a Spanish company).

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