Immediate Supply of Information on VAT (SII) in Spain
By Carlos Frühbeck Olmedo, Ficesa Treuhand, S.A.P.
July 2018 marked a year since the implementation in Spain of the Immediate Supply of Information (SII) on value added tax.
This procedure is mandatory for all those taxpayers who exceed a turnover of EUR 6 million and for those taxpayers who apply for monthly VAT refunds. The procedure basically consists of these entrepreneurs being obliged to notify all their invoices issued and received to the tax agency electronically, with a maximum delay of four days. Communication is carried out through an interface with the web page of the tax agency.
The implementation of the SII has meant significant effort of a technical nature for all the enterprises concerned, since they have had to adapt their computer systems to be able to provide information in real time to the tax agency.
This new information system has allowed the Spanish tax agency to have real-time data from all the invoices issued and received by large enterprises, and in case of discrepancies occurring, apply for taxpayers to provide the corresponding clarification.
However, the standout effect of the implementation of the SII is that companies which have not properly declared their received invoices in the system lose the right to deduction of VAT until the mistake or the omission is rectified. The tax agency automatically verifies that the data included in the VAT tax returns matches the information provided in the SII and if any discrepancies are detected, a limited verification procedure is started. If the taxpayer has requested a VAT refund, the initiation of the procedure paralyses the VAT refund until the discrepancies are clarified or the errors are remedied.
However, it still remains to be seen if this procedure will serve to reduce existing VAT fraud, since such fraud is essentially located in small and medium-sized enterprises, which are those that are mostly not yet obliged to declare in the SII their invoices issued and received.
Carlos Frühbeck OlmedoFicesa Treuhand, S.A.P., Madrid, Spain
T: +34 91 700 43 50
Carlos Frühbeck Carlos Frühbeck is member of the Spanish Official Register of Chartered Accountants. He speaks English and German fluently and is currently managing partner of Ficesa Treuhand, S.A.P., an accounting, auditing and fiscal advisory company founded in 1978. The company currently have five offices in Spain, located in Madrid, Barcelona, Marbella, Palma de Mallorca and Gran Canaria. The firm specialises in providing services to Spanish subsidiaries of multinational groups. The staff speak German, English and French in addition to Spanish.
Published: Autumn 2018 l Photo: ©Kavalenkava - stock.adobe.com