This guide explains how to invoice your clients as an autónomo—what information it should include and when to charge IVA. An invoice is called ‘Factura’ in Spain, and this should be clearly stated at the top of your invoice. It is essential to issue invoices to your clients in the correct format, as it serves as the only valid document for tax purposes.
You will need to include the following details on your invoice:
- Invoice number;
- Invoice date;
- Your full name and business address;
- Your client’s name and address;
- Tax Identification numbers of both parties NIE/NIF/CIF;
- Description of goods or services provided;
- Your rate or the amount charged per unit, and quantity;
- The taxable base (base imponible) – this is the total amount charged excluding VAT;
- VAT charged, including a breakdown of the different rates if applicable;
- Income tax retentions, if applicable;
- The total amount due, including taxes.
At the bottom of your invoice, you will also indicate the payment terms (invoice due date) and the payment method (your banking details).
When to charge VAT on your invoices
|Invoices to:||Should IVA be charged?|
|EU VAT-registered companies||
No – IVA does not need to be included and your customer should account for VAT on the invoice according to the EU Reverse-Charge rule
|non-VAT registered individuals in EU countries||Yes – IVA should be included|
|non-EU individuals and companies||No – IVA exempt|
It is important to distinguish between VAT-registered businesses and non-VAT registered individuals.
|Standard rate (Tipo General)||21%|
|Reduced rate (Tipo Reducido)||10%|
|Super-reduced rate (Tipo Superreducido)||4%|
The general IVA rate in Spain is 21%, however, some products and services are taxed at different rates, click here for more information on these rates. For each rate of IVA charged on your invoice, you will have to break down the taxable bases accordingly.
Remember that you will need to pay the corresponding IVA charged on your invoices by submitting a quarterly tax return—Modelo 303. Even if you have not made any sales in the quarter, you will still need to file a nil IVA return. Please contact us if you require further assistance with filing your tax returns.
Retenciones – Personal income tax witholdings (IRPF)
As an autónomo, you have a choice on whether to deduct tax retentions on your invoice to Spanish clients instead of filing a quarterly Modelo 130 tax return. This is usually done in the case where all of the clients are Spanish businesses (SL companies), as an individual customer would not be able to pay over any tax retentions to the Tax Office.
In the case where tax retentions are chosen, you would be providing a cashflow benefit to your client as they are at 7% or 15%, compared to 20% with Modelo 130. You will have to include the applicable income tax retention rate on your invoice, which is calculated on the taxable base (total amount excluding IVA):
|7%||on invoices who have been registered as an autónomo for less than two years|
|15%||on invoices after two years, this is the standard retentions rate|
|19%||on rental invoices for business premises|
When you invoice with retentions, you are essentially paying this tax over to your client, who would be legally obliged to withhold this part of the payment and pay the income tax on your behalf by filing a Modelo 111 quarterly tax return.
The withheld amounts paid by your client to Hacienda are then credited to your final annual income tax bill, which is calculated on your ‘Renta’ or Modelo 100. This tax paid will appear as a payment on account (i.e. reduction) against your final tax due.
If you are invoicing some foreign clients or non-business individual clients, you cannot have tax retentions on these invoices, so in this case, you would still need to file a Modelo 130 quarterly. On the Modelo 130, you would declare all of your income including the invoices to Spanish businesses, and the tax retentions on these invoices would be recorded in a separate line of your tax return so that you would not need to pay the tax on this income again.
We can provide an invoice template to help newly registered autónomo clients get started. If you are interested in our autónomo services such as autónomo registration, filing your quarterly and annual returns, or need some tax advice, please email email@example.com and we will be happy to assist!