Spain Explained

IVA in Spain: All you need to know about Spanish VAT

Last updated on April 28th, 2020 at 10:59 am.

The Spanish Government has to increase the amount of tax it collects alongside saving money through austerity measures. One of the main ways that countries have been doing this across Europe is through increasing the rate of VAT (IVA in Spain). Spain followed suit in September 2012.

In this article we will go through some relevant information regarding Spanish VAT or IVA in Spain. However, we would like to remind you that there are other taxes to be paid in Spain. Taxation in Spain can be complicated and you could be subject to fines or penalties if you miss a deadline or don’t do your taxes properly. Advisably, you should seek fiscal advice from an expert to avoid possible complications.

Types of IVA in Spain

VAT in Spain is called IVA and there are three types of IVA in Spain:

  1. Super reduced rate IVA – 4%
  2. Reduced rate IVA – 10%
  3. General rate IVA – 21%

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1. Super reduced rate IVA

This rate is applied to items of a primary and basic need. This includes staple food items such as cheese, milk, beans, fruit and vegetables. It also applies to books and magazines and vehicles for  the disabled.

2. Reduced rate IVA

This includes foodstuffs in general (except those listed above). Soft drinks, contact lenses and glasses, house construction, passenger transport, refuse collection, health assistance services, social services and dental work.

3. General rate IVA

This rate is applied to all products and services that are not considered to be of a primary necessity. This includes for example, alcoholic drinks and tobacco, CDs and DVDs, petrol and diesel.

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Changes to IVA in Spain

September 2012 saw some adjustments between these categories with the result that some services and products have moved from the reduced rate IVA to the general rate. These include:

  • hairdressing
  • sports
  • cultural and recreational services
  • exhibitions and fairs
  • funeral services

These are the services and manufacturers that will be hit most by the September 2012 increase to IVA with a substantial rise from 8% (the old reduced rate) to 21% (the new general rate).

The increase in IVA in Spain wasn’t across the board. The rate for the reduced band and general bands went up (2% and 3% respectively) but the rate for super reduced products and services stayed the same at 4%. In spite of the increase, Spain continues to have one of the lower rates of IVA, a point noted recently by Brussels.

If you would like more information about all the taxes you need to pay in Spain, you can visit this article: Taxes in Spain. As we said, we recommend seeking fiscal advice from an expert to avoid possible complications.

To help navigate the bureaucracy of the Spanish tax system, our dedicated advisers are on hand to help at every step of the way. Fill out this form and we will offer you a free consultation without obligation.

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Derek Hanratty

12 October, 2015 5:25 pm

Hi can you please advise me
Hi can you please advise me on the rate of IVA in Spain when selling property.
Thank you

Suzanne O'Connell

14 October, 2015 8:03 am

Hi Derek

Hi Derek

Thanks for your enquiry. If you buy a brand new property then you pay 10% IVA and stamp duty. 

William Crook

6 February, 2023 5:51 pm

I run a Club which includes Paddle, Crazy Golf, Gym etc plus membership to this club. I charge IVA for these sport activities (this includes individual sporting lessons/classes) and club membership. Is this correct or does club sport come under IVA exemption.

Dirijo un Club que incluye Pádel, Crazy Golf, Gimnasio, etc. además de ser miembro de este club. Cobro IVA por estas actividades deportivas (esto incluye lecciones/clases deportivas individuales) y membresía del club. ¿Es esto correcto o el deporte de club está exento de IVA?

Oscar Paoli

8 February, 2023 12:47 pm

Sorry for the inconvenience but we do not deal with these kind of matters.

With kind regards,

Ábaco Advisers

Spencer Brown

2 October, 2023 3:19 pm

Hi, I am English and live in England. I have a house near Tarragona that I am rebuilding. Is there any way around paying IVA on the construction works? I ask in case there is any exemption, e.g. for foreigners?

Many thanks


Oscar Paoli

3 October, 2023 7:44 am

Dear Spencer,

Thank you for your email and your inquiry regarding IVA on construction works for your house near Tarragona.

As of our last knowledge, IVA regulations in Tarragona are subject to change and may vary depending on several factors, including the type of construction work and your specific circumstances. Generally, IVA applies to most construction services and materials in Spain.

However, there may be certain exemptions or reduced rates for particular types of construction or specific situations, such as renovations on historical properties or primary residences. These exemptions or reduced rates can change over time and are subject to government policies.

To determine if there are any exemptions or reduced rates applicable to your construction project as a foreign property owner, I recommend consulting with a local tax advisor or a legal expert who specializes in Spanish taxation and property laws. They can provide you with the most up-to-date information and guidance tailored to your situation.

It’s essential to ensure compliance with Spanish tax laws while also exploring any potential cost-saving opportunities within the legal framework.

I hope this information is helpful, and I encourage you to seek professional advice to address your specific circumstances accurately.

Best regards,

Ábaco Advisers