Blogs and advice from Industry leading Specialists
Valuable Opinions, Comments & Gossip
Financial related News & Articles relating to Spain
Latest News, Stories
& Hot Topics
Various Tools & Widgets to help with your financial needs
Tools & Widgets to
help with finances
Polls, Surveys and Opinions featured throughout Tumbit
Featured Polls, Surveys & Stats
Discussions, Advice & Topical Chat
Discussions, Advice & Topical Chat

Spanish IVA Explained

- Updated: 10/03/2015
Spanish IVA Explained

What is IVA in Spain? IVA or Impuestos sobre el Valor Añadido, put simply, is the UK equivalent of VAT and is applied to pretty much everything you buy

For many years, Spain has enjoyed some of the lowest rates of tax added to goods and services amongst it's fellow European states. The advantage of low taxation has boosted Spain's popularity as a value for money destination. However, on the July 11th 2012 Prime Minister Mariano Rajoy informed Parliament that a rate in IVA would be applied as from the 1st September. This could spell severe problems for businesses but more importantly families and visitors to Spain as they are all hit hard in the pocket reducing their spending power significantly.

There are a variety of IVA taxation rates in Spain which are applied to different goods and services, but are you aware of what the current rates of IVA are and to what goods or how they are applied...?

The 4% "Basic Rate"

This is applied to all items that are considered to be of basic and primary need. It includes :

- Bread, frozen dough, eggs, cheese, milk, beans and fruit and vegetables.

- Books, magazines, newspapers and Public Museum Entrance.

- Medicines ( NOT for Animals though )

- Vehicles for the disabled, wheel chairs and other transport for the disabled.

- Prosthetics and implants.

- Official protected housing.

The 10% "General / Standard Rate"

This is applied to :

- Foodstuffs in general (Excepting those in the 4% band)

- Soft drinks.

- Animals that are to be for human consumption or breeding.

- Agricultural products, farming and forestry activities, such as seeds and fertilisers.

- Contact lenses and glasses.

- Disabled lifts and products for the diagnosis of illnesses.

- Health assistance services, social services, and dental work.

- Imported artworks and antiques.

- The sale of property, including garages and annexes.

- House construction (between promoter and contractor).

- Services supplied by artists and technicians.

- Hotel and restaurants

- Cleaning of streets and public gardens.

- Refuse collection.

- Public transport and Motorway Tolls.

- e-books, DVDs, music CDs, as well as cinema and theatre tickets. *

- Sports, cultural and recreational services, exhibitions and fairs. *

* Moved from the lower 4% rate to the higher 21% in September 2012; then down to the 10% rate as from March 2015

The – 21% "Higher Rate"

This rate is the general rate, which is applied to all other products, including :

- Alcoholic drinks and tobacco

- Animals used in bullfighting

- Agricultural machinery.

- Devices for the diagnosis and monitoring of pregnancy.

- Television and radio services.

- Petrol & Diesel.

- Hairdressing *

- Funeral services *

*Moved up from the 4% lower rate to the 21% higher rate in September 2012

Comment on this Article

We were charged IVA @ 21% on the refundable deposit for excess insurance on our car hire with / by Dickmans and when we returned the car in perfect condition the IVA amount was withheld and not refunded and this amounted to about €170 ! This cannot be legal surely ? Also, our deposit was banked and not returned for a month. Can anyone help resolve this please.
Richard Ansley - Fri 30th Jun 2017
I have just taken over as president of a charity called "Reachout" in Torrevieja. We have a shop where we sell "donated cloths and bric or brac" to raise money to house and feed the homeless' my do we pay IVA on these donated goods sold in our shop?
Brian Prockter - Thu 29th Jun 2017
We hired a car recently in Murcia with Dickmans. We were charged IVA @ 21% for our refundable deposit against uninsured damage to the vehicle. As there was no damage we expected to have the whole amount we paid, including the IVAcharged, refunded. The IVA element was not refunded. Also, as the deposit was not a "bought" item should it be applied anyway ? Can you help clarify/confirm please.
Richard Ansley - Wed 17th May 2017
Hi I have a villa in Spain I recently had to get a new pool pump is the Iva included in the price and do I have to pay Iva to the person who fits it
Alan - Tue 25th Oct 2016
Hi we run a retreat venue offering food and accommodation what is our Iva on this service pls as we're being charged 21% Iva Thanks for any help Michael
Michael - Sat 22th Oct 2016
If my Spanish business sells Spanish holidays in the UK, am I obliged to collect VAT on the sale price and account for that VAT received to the Spanish authorities? What rate of VAT would be applicable? I note Spanish hotels are obliged to add VAT at the reduced rate of 10%. Would I be able to claim that VAT paid from the Spanish authorities? Would I be able to reclaim in Spain any VAT incurred in other EU countries? Many thanks, Vivian
Vivian Ashworth - Wed 9th Mar 2016
We are extending our property in Spain to make a bigger kitchen, as well as purchasing new kitchen units and appliances. Can you tell me if extensions attract VAT at the higher 21 % rate (for materials and installation); and also do the units which will be assembled and installed on-site attract the higher or reduced rate of 10%?
Catherine Bailey - Sat 30th Jan 2016
Kindly confirm if there is indeed 21% IVA on shipping/packaging charges and also on Auction Commission? I bought 2nd hand jewelry on-line in Spain where I live and they are charging me on both plus 21% IVA. I understand that there is no IVA when buying 2nd hand items here. Also, the actual invoice says 18% IVA that?s where I got confused more. Thank you in advance for your help.
Bernie - Wed 13th Jan 2016
We are selling a house in Spain. What taxes will I have to pay?
Sandra Goodwin - Fri 4th Dec 2015
I have used a Cleaner to Clean my Boat. He wants to charge me IVA. In UK Businesses do not need to Register for VAT if their Turnover is below a certain level. I think it is about ?70,000pa. Can you let me know the appropriate figure in Spain. His Bills do not seem to quote an IVA number as do other Contractors. Roger Dean.
Roger Dean - Wed 22th Jul 2015
as far I am aware the rate of IVA applied for property / DIY purposes depends on whether it is for a new build or refurb project. It sounds like your supplier is either making assumptions or charging what he thinks he can get away with.
Gav - Tue 21st Jul 2015
I have had 2 quotes for glass curtains and sandwich lnsulated panel roof on the terrace of my property in spain ----------first quote is @ 21% iva-----------second qote is @10% iva------what is the CORR,ECT rate?
Chris - Wed 15th Jul 2015
Alan : Depends on the retailer you buy from in Europe. My understanding is that IVA must now be charged in the country of purchase, for the country of receipt. ie. The IVA is set by the US and collected in the country of purchase, in this case Spain... The good news is that you are not hounded for import taxation to the US because you'll have paid the tax. Tax exemption is only now applicable to businesses and self-employed individuals. Someone correct me if i'm wrong...
Ed Bishop - Tue 10th Mar 2015
Roy : The 10% rate of IVA is only applicable to new properties - renovation work is charged at either 10% or 21% depending on the nature of the work being undertaken.
Tyler - Tue 10th Mar 2015
I have read elsewhere that IVA on renovation and alteration on residential property is 10%. Is this correct ? Thank you
Roy - Sat 14th Feb 2015
If I living in the United States buy something from Spain on line and it is shipped or mailed to me in the US am I exempt from paying IVA ? MY purchase will be a Spanish saddle for equestrian use...
Alan Flashing - Sat 22th Mar 2014

Alan : Car Rental is charged at the General Rate of 21%

George : Assuming you will be invoicing your Tenant, then you must charge them 21% IVA.

Tumbit - Admin - Mon 29th Jul 2013
Is property rent subject to IVA ? If a private persons rents out a room in his house is that liable to IVA ?
George - Mon 29th Jul 2013
what is the tax rate on car hire in spain,does anybody know ?
Alan Lunn - Sat 20th Jul 2013
My contractor has charged me 21%iva on the paint for the exterior claiming that this will secure the guarantee for 5 years. Is this right????? Appreciate your advice
Amina - Thu 27th Jun 2013
Your Plumber might not be a limited company - maybe he is just a sole trader / Autonomo - in which case he wouldn't need to be.
Gordon P - Mon 24th Jun 2013
I have been charged 21% iva by a plumber for some work at my house. His bill shows the amount charged but should not there be a CIF or similar number on the bill to show he is registered for IVA? The only number is his NIE. Hope someone can help.
S Guest - Sun 23rd Jun 2013
Yes, 21% on Garden and Maintenance Services is correct.
Eric - Tue 11th Jun 2013
Is the 21% rate applicable to garden maintenance on a community of four houses., also pool cleaning? If so is there a threshold that the company has to earn before the IVA is implemented?
Brian Barr Leeds - Mon 10th Jun 2013
Bill - Building, Repair and Maintenance works is taxed at the higher rate of 21% - I assume that painting will fall under this category.
Robster - Wed 16th Jan 2013
What rate of IVA should we be charged for getting the exterior of a building painted?
Bill Gemmell - Wed 16th Jan 2013
@David - My understanding is that ANYTHING bought on or after the 1st Sept. 2012 is subject to the new IVA rates, however, if a deposit was paid for something before this date, technically the purchase was made then, therefore you are simply paying the outstanding balance. Unfortunately it is all down to the retailer. I would remind the retailer of this fact. If you have a receipt, this will further backup your argument. The retailer would be best to work with you if they want your continued business! In any event, the retailer would have bought the item pre-IVA increase therefore his/her tax liability is the pre-IVA increase rate also!
Ed Bishop - Tue 18th Sep 2012
Any idea what the rule is about a purchase that was made before the IVA increase, and for which a deposit was paid, but the goods delivered after September 1? I am being told I need to pay the extra 3% which seems "dodgy" to me.
David Taylor - Tue 18th Sep 2012
John : A number of Products & Services have not only had their rate of IVA increased, but they have been move from the standard rate to the higher rate of IVA aswell. Some of these services include Flowers, Entry to Theaters & Cultural Events and Funeral Services. Whilst I can not confirm this for certain, it would not surpirse me if this applied to club membership aswell.
Tumbit - Admin - Mon 23rd Jul 2012
What will be the effect of golf club membership fees. I am not sure from the article whether they are currently 8% or 18%. If the former will they go up to 10% or if the latter will they go up to 21%. I have been told that they are to rise from 8% to 21%. Can you confirm ?
John - Mon 23rd Jul 2012
Is IVA applied to items bought at online auction in Spain and then shipped to another country?
Stephen Ellison - Fri 13th Jul 2012
This doesn´t sound right to me either. Surely they can only charge IVA on their portion of the bill, as opposed to an accumulated charge ? - I would certainly question this with them, and if they stick to their guns tell them that you will pay both them and the contractor separately.
Mr Grumpy - Mon 12th Dec 2011
We own a villa in Spain. When we have work done, we are charged IVA by the person who does the work, then the management company also charge us IVA when they put the work on their invoice. Is this correct? We appear to be paying IVA on the same work twice?
Jenny H - Sun 11th Dec 2011
Norman, IVA for building maintenance and repair work is chargeable at 18%
S Clarke - Wed 16th Nov 2011
I am going to employ a Spanish company to paint all the dwellings on our urbanisation. Payment from our community fees. What is the correct IVA rate with thanks
Norman Ollier - Wed 16th Nov 2011
Afraid not, IVA is 18% on all builiding material, the lower rate of IVA only applies when buying a property, as opposed to reforming it.
Dave C - Sat 23rd Jul 2011
Hi, I am reforminga cortijo at the moment. I have noticed that I am being charged IVA at 18%. I tought this should be at 8% for building materials. What do you think? Regards Dennis
Dennis Radford - Sat 23rd Jul 2011