Spain modifies simplified REGE VAT group regime 1 January 2025
Under Spanish VAT law, the formation of VAT groups is permitted, aligning with the provisions of Article 11 of the EU VAT Directive (Council Directive 2006/112/EC). However, unlike most other EU member states, entities within a VAT group must maintain individual VAT registrations. While the VAT group as a whole is assigned a Spanish tax identification number (NIF), each member entity retains its individual NIF for VAT purposes.
Spanish VAT grouping does not establish the group as a single taxable person under Article 11 of the Directive, unlike in some other EU Member States. Consequently, intra-group transactions are not disregarded for VAT purposes; they remain subject to the standard VAT rules. Each group entity is responsible for fulfilling its individual VAT compliance obligations. However, Spanish VAT law provides an administrative simplification allowing the consolidation of VAT payable or refundable into a single payment by the representative entity of the VAT group. This consolidation can provide significant administrative efficiency and cash flow benefits for corporate groups.
See more in our Spanish VAT guide.
1 January 2025 REGE VAT Group rule changes
Effective from 1 January 2025, Spain’s tax authorities have introduced a new VAT regime for groups of companies, referred to as the Special VAT Regime for Groups (Régimen Especial de Grupos de Entidades or REGE). Entities electing to apply this regime must submit Form 039 to notify their participation, waiver, or modification in the REGE, as well as any election for the advanced REGE arrangement and the monthly VAT refund system. Additionally, a detailed list of all group members must be provided, specifying any changes compared to the previous tax year.
Taxpayers must also use Form 036 or Form 037 to notify their application or waiver of the special cash accounting regime for VAT purposes from 2025 onward. Notifications for other special tax regimes include waivers for the simplified regime, as well as the special regime for agriculture, livestock, and fisheries. Taxpayers may also use these forms to opt for specific methods of calculating tax bases under special VAT schemes.
Regarding compliance with electronic records and reporting obligations, companies with an annual turnover exceeding €6,010,120.14 in 2024 will be required to adopt the immediate supply of information (Suministro Inmediato de Información or SII) system from 1 January 2025. These entities must notify the Spanish Tax Agency of their large enterprise status by the end of January 2025 or by the due date of their first periodic VAT return for 2025.
EU VAT Group rules
Poland has to introduced the scheme under the rules of the EU VAT Directive Article 11 of Directive 2006/112/EC. This stipulates that group members must be closely linked financially, economically and organisationally to be treated as one taxable person. Typically, this means at least 75% share control of companies within the group, shared management or shared business goals or activities. This can include a member of the group providing goods or services that are mostly / wholly consumed by other members of the group.
Poland will be expecting one nominated member of the group to take on responsibility for the consolidated return.
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