VAT SCHEME FOR AGRICULTURE & FISHERIES

 

This special VAT arrangement is characterized by the absence of output VAT (except in case of import, EU acquisition or reversal of taxable person). Since there is no output VAT, input VAT cannot be deducted. In order to neutralize the impact of output VAT, there is a flat-rate compensation in every operating sale: 12% for agriculture operations and 10,5% for livestock and fisheries operations. This percentage is applied to sale price of products or services, excluding indirect taxes.

REQUIREMENTS

It is applicable to the owners of agricultural, livestock, forestry or fishing farms that had not opted out this scheme, unless they had ceded the farm or were in an integrated livestock regime.

It is not applicable to activities of transformation, processing of manufacturing of natural products, sale of own products mixed with others acquired from third parties (unless they are mere preservatives), sale of products outside the farm, sports and recreational activities, sea fishing, independent livestock and accessory services that are not included in the scheme.

Trade, cooperative and agricultural processing companies can not use this special arrangement. Self-employed whose turnover in this special scheme has exceeded €250,000 in the previous year and self-employed whose turnover in other VAT arrangements had exceeded €250,000 in the previous year cannot apply it either.

WAIVER TO VAT AGRICULTURAL ARRANGEMENT

Taxpayers may waive to this special arrangement by delivering a form 036 or 037 to the Spanish Tax Office. The waiver has a minimum validity of 3 years. A taxpayer who practices a deduction of input VAT is understood to have resigned tacitly to this special arrangement.

FLAT-RATE COMPENSATION

The refund of the flat-rate compensation (12% or 10,5%, as explained above) must be paid by the recipient of goods or services. However, in case of exports, EU operations and operations provided to recipients who are established outside the territory of application oft he tax, it is made by the Public Treasury.

BEGIN OR END OF THE SPECIAL ARRANGEMENT

When an activity changes from general to special VAT scheme, the owner is obliged to pay the compensation corresponding to future deliveries of natural products already existent on the date of change.

When an activity changes from special to general VAT scheme, the owner will have the right to deduct input VAT corresponding to operating goods affected to the activity on the date of change.

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VAT SCHEME FOR INVESTMENT GOLD

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Investment gold are gold bullion/sheets of milesimal fineness 995 [1] and gold coins of milesimal fineness 900, minted after 1800, that have been legal tender in the country of origin, sold at a price that does not exceed 80% of the market value of the gold contained in them. [2]

EXEMPTION OF TRANSACTIONS, WHEN THE OBJECT THEREOF IS INVESTMENT GOLD

In general terms, deliveries, EU acquisitions and imports of investment gold are exempt from VAT, but the taxable person may waive the exemption in some cases. Mediation services in these operations (on behalf of thirty parties) are also exempt. 

The exemption does not apply to EU acquisitions in which the provider of investment gold renounces the exemption. 

In case two possible exemptions were applicable (a gold investment and a EU acquisition one), investment gold one prevails. 

WAIVER OF EXEMPTION

Providers of investment gold may waive the exemption in the following cases:  

1. When they are regularly dedicated to produce investment gold or to transform non-investment gold in investment gold.
2. In deliveries of gold which has been transformed into investment gold. 
3. When the acquirer is a buisnessman or a professional.

The exemption can also be waived in case of mediation on behalf on thirty parties in exempt operations, provided that the acquirer is a businessman or a professional, and  when the provider had waived the exemption. 

The waiver must be done per operation, performed by the service provider and communicated in writing to the acquirer (prior or simultaneously to the acquisition). The acquirer also has to be informed in writing of his henceforth condition of taxpayer. 

DEDUCTIONS

In general terms, supported VAT is not deductible, since investment gold deliveries are exempt from VAT. 

Exceptionally, the following must be taken into account:

1.  Exempt deliveries of gold investment generate the right to deduct supported VAT quotes when done by businessmen or professionals who have produced or transformed that investment gold. 
2. Deliveries of exempt investment gold by businessmen who are not contemplated in a), generates the right to deduct.
3. Supported VAT corresponding to the internal or EU acquisition of that investment gold, when the supplier had waived the exemption.
4. Supported VAT corresponding to acquisition or import of investment gold, when it did not meet the pertinent requirements at the time of its acquisition or import.
5. Supported VAT corresponding to services of change of form, weight or milesimal fineness.

TAXABLE PERSON

In case of waive to the exemption by the provider, the taxable person of investment gold deliveries, is the recipient businessman or professional. 

FORMAL OBLIGATIONS

Businessmen and professionals who carry out operations of investment gold must keep copies of all invoices corresponding to these operations within 5 years (article 140 sexies of VAT Law)

Businessmen and professionals who carry out gold investment operations and other kind of operations must pertinently separate the operations corresponding to each scheme in their VAT books. 

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[1] Provided that the weight accomplishes addendum 9th of VAT Law.

[2] These requirements are accomplished in all coins related by the EUOD before 1st of December each year.

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NEW MEASURES AGAINST EVICTION PROCEDURES

Since the beginning of the economic crisis, forcible evictions have been a constant in Spain. Particularly affected are people who have lost or are in risk of losing their job and have difficulties entering or re-entering the labour market.

Recently, the Royal Decree-Law Nr. 5/2017, of 17.03.2017, has approved the following two important measures to protect people considered to be in risk of social exclusion:

1.      Eviction procedures can be suspended to a maximum of 7 years. This term ends on 05.05.2020, since the deadline runs from the entry into force of Law 1/2013.

 

2.      In case the eviction has already occurred, they may request from the creditor the rental of the house for a maximum annual rental price of 3% of knockdown price. The deadline for requesting it is six months, from the entry into force of the RDL Nr. 5/2017.

The most significant group of people in situation of social exclusion are those who have suffered a significant alteration of their economic circumstances in the last 4 years. This alteration occurs when the result of dividing the mortgage burden into the rent had increased, at least, 1,5.

Other people in situation of social exclusion are the following:

1.      Large families

2.      Single parents

3.      Families with a minor

4.      Families in which a member has a disability greater than 33%

5.      Victims of gender violence

6.      Debtors over 60

7.      Families living with disabled, dependant or serious ill people.

The RDL Nr. 5/2017 has entered into force on March 18th of 2017.

 

 

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Luisa Fernández Baladrón is a registered lawyer at the I.C.A.I.B.