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Outputting VAT within one year in spain and possible non-deductibility of input VAT
We advise multinationals because we are not one of them
On the obligation of outputting VAT within a period of one year and the non-deductibility of input VAT if inputting is made past the deadline
Spanish regulations require the seller of goods or services to issue the invoice within a maximum period of one month following the transaction. The pertaining VAT must evidently be included in the invoice. In the event of failure to do so due to error or omission, the seller has up to one year to output the VAT, that is, to issue a new invoice and claim the payment of VAT from the buyer. Should this not be done, the seller loses the right to claim payment of VAT from the buyer, notwithstanding the payment of VAT to be made to the Tax Authorities. In this case, VAT will become an expense for the seller.
For this reason, in the event that the seller should send the buyer a sales invoice with a delay exceeding one year (due to seller’s mistake) indicating, for example, the item “sale of machinery on 10.1.2011” and having received the invoice in April 2012, the buyer should under no circumstance pay the VAT on the invoice, as this was accrued in January 2011 and more than one year has lapsed since that time.
Should the buyer pay the VAT by mistake, the input VAT in the invoice cannot be deducted, as VAT deduction is only possible if the payment of VAT is required; this is not the case here, as the obligation to pay VAT has lapsed (one year). For this reason, the buyer must always check the date on which the obligation to pay the VAT has accrued. And if it should be discovered that non-required VAT has been paid, the buyer may claim a refund of the input VAT from the Administration, but this will not be automatically deducted in his ordinary VAT returns. The ruling allows the payer of the invoice to claim the refund of the input VAT from the Tax Authorities, even though the regulations governing this refund state that this may be only claimed by the seller.
The Tribunal Supremo rulings dated 18.3.2009 and 9.1.2008 deal with this matter.