On October 30th 2013 the Spanish Official State Gazette (BOE), published Law 16/2013, of October 28, 2013. That Law modifies the matriculation/registration tax exemption established by the Spanish Excise Duties Law (Law 39/1992) for vessels effectively and exclusively engaged in the charter activity, eliminating the reference to the maximum length of 15 meters that was required under the previous wording of the Law in order to benefit from the tax exemption.
In order to start a charter activity shall be necessary to get a double permission (national and regional).
The position of the Spanish Marine authorities is keen to accept that non EU flagged vessels can obtain a charter license, provided VAT position is resolved.
The main difference compared with an EU flagged vessel is that it would be necessary to apply for a special permission to the Merchant Marine Directorate in Madrid, in addition to the authorization of the local office of the Marine Authority of the region where it is intended to be chartered.
From an administrative perspective and with regards to non EU flagged vessels, some local governments (e.g. Balearics) establish restrictions to the possibility of carrying out charter activities with non EU flagged vessels.
VAT registration – Non-Spanish Entities
If the Owning Company wishes to operate charter operations in Spain, it will be obliged to obtain a non-resident tax number (N.I.E or N.I.F.)
VAT on charter fees
With regards with the place of supply of short term hiring of a mean of transport, if the vessel is put at disposal of the client in the Spanish territory, Spanish VAT will be due. Referring the percentage of VAT applicable to charters occurring in Spain, the charter services rendered in Spain are subject to VAT at 21%.
Instead of what is happening in other EU countries, there is no option to apply a reduced VAT for charter services rendered in Spain. In case of a charter starting a non-EU port and terminating in a Spanish port VAT, theoretically VAT would be due on the total navigation performed in the Spanish waters.
VAT is due on the APA amounts independently if all the invoices charged to the APA are under the name of the final client. If the invoices are under the name of the boat, the VAT must be added to the final invoice from the boat to the client. It will be paid by the fiscal representative to the Spanish Government, together with the VAT due on the charter fees.
Fuel and provisioning
The current situation in Spain is that provisioning to commercial vessels engaged in charter activities are subject to VAT.
Sneed Charters team will be more than happy to assist all Clients interested in cruising in Spain providing them all necessary information and support with local authorities.
Please do not to hesitate to contact our office, we always stay at your entire disposal 24H/day.