The Spanish VAT authorities have recently published several public consultations concerning different questions related to the interpretation of a permanent establishment for VAT. The new interpretation seems to differ to the previous legal position. In case that a company rents or owns a warehouse in Spain, there is a risk that this warehouse creates a permanent establishment from the Spanish VAT perspective and that the company therefore needs to charge VAT on its supplies of goods in Spain.

I would highly recommend that companies with (rented or owned) warehouses in Spain review their current situation in Spain very carefully in order to eliminate a potential risk, both from a VAT and direct tax point of view.

If you need further details please do not hesitate to contact me.