VAT for the Self-Employed in Spain: How to File Form 303

How VAT works: output minus input

Every time you issue an invoice subject to VAT, you add the relevant tax to the taxable amount. That is output VAT, and it does not belong to you: you collect it on behalf of the Tax Agency. In turn, when you buy goods or services for your business you pay VAT to suppliers; that is input VAT, which you can deduct if you meet the requirements.

In each return period you subtract deductible input VAT from output VAT. If the result is positive you pay it; if negative you carry it forward or, in the last period of the year, you can claim a refund. That is why it is good practice to set aside VAT as soon as it reaches your account: it is not profit.

VAT rates and exempt supplies

On the mainland and the Balearic Islands there are three VAT rates. The Canary Islands, Ceuta and Melilla do not apply VAT but IGIC and IPSI respectively. Choosing the wrong rate is a common mistake that carries over for quarters, because it affects every invoice for the same service.

Beyond the rates, some supplies are exempt: no VAT is charged and, as a rule, input VAT cannot be recovered either. Examples include healthcare, accredited education and certain private tuition, insurance, many financial services and residential rentals. There are also reverse-charge cases where the customer accounts for the VAT, such as certain construction work or services supplied to businesses in other EU countries.

• 21% (standard): most professional services, technology, clothing, electricity and repairs.
• 10% (reduced): hospitality and catering, passenger transport, certain home renovation work and some foods.
• 4% (super-reduced): bread, milk, eggs, fruit, vegetables, books, newspapers and medicines for human use.

A worked quarterly example

A consultant invoices a total taxable amount of €15,000 at 21% in the third quarter of 2026, which is €3,150 of output VAT. In the same period she has €4,000 of expenses at 21% (€840 of VAT) and business meals of €500 at 10% (€50 of VAT).

Her deductible input VAT is €890. The form 303 result is €3,150 − €890 = €2,260 payable. If she had €300 left to carry forward from the previous quarter, she could apply it now and pay €1,960.

Note that the income tax withholding shown on her invoices plays no part in form 303: it is reported on other forms. VAT is always calculated on the taxable amount, before withholding.

Form 303 deadlines in 2026

Most self-employed people file VAT quarterly. According to the Tax Agency's 2026 taxpayer calendar, the first quarter was due by 20 April, the second by 20 July and the third must be filed by 20 October 2026. The fourth quarter is filed in January of the following year, by the 30th, together with the annual summary; if that day falls on a weekend, the deadline moves to the next working day.

If you want to pay by direct debit the window is shorter: for the third quarter it closes on 15 October 2026 and the payment is collected on the last day of the period. Monthly filers, such as those on the monthly refund register (REDEME) or large companies, file each month's 303 by the 30th of the following month: September by 30 October, October by 30 November and November by 30 December.

Even if you had no activity in the quarter, you must file form 303 showing zero while you remain registered. Failing to do so may lead to a formal request and a penalty.

• Third quarter of 2026: by 20 October (direct debit by 15 October).
• Fourth quarter of 2026 and form 390: in January 2027, by the 30th or the next working day.
• Refund result: only in the last period of the year, except for those on the REDEME.
• Carry-forward balance: can be applied in returns over the following four years.

The annual summary: form 390

Form 390 summarises all transactions for the year and must match the sum of the 303 returns filed. It is filed from 1 to 30 January of the following year, with the same deadline as the fourth-quarter 303. It is informative only and involves no further payment, but mismatches with the quarterly returns are one of the most common reasons for letters from the Tax Agency.

Not everyone must file it. Those exempt include businesses keeping their records through the Immediate Supply of Information system (SII), those making only exempt supplies, and quarterly filers taxed only in common territory whose activities are limited to the simplified VAT scheme or urban property rental. These taxpayers must complete the specific section of the fourth-quarter 303 with their annual turnover.

Pro-rata: when you mix exempt and taxable supplies

If you make both supplies that carry the right to deduct and exempt supplies that do not, you cannot recover all your input VAT. The general pro-rata rule limits the deduction to the percentage that deductible supplies represent over the total, rounded up to the next whole number.

Example: a physiotherapist earns €40,000 from exempt healthcare treatments and €10,000 from selling products and non-exempt courses. His pro-rata is €10,000 / €50,000 = 20%. If he incurs €3,000 of input VAT on shared costs during the year, he can only recover €600; the remaining €2,400 becomes an additional income tax expense.

During the year the provisional pro-rata applies, which is the previous year's final figure, and in the last 303 the final pro-rata is calculated and the difference adjusted. If costs can be clearly allocated to each type of supply, the special pro-rata may be worthwhile; it is elected in the return for the last period of the year.

Equivalence surcharge for retailers

Retailers who are individuals, or entities made up of individuals under income attribution, and who sell to end consumers without transforming the goods are automatically included in the equivalence surcharge scheme, except for certain excluded products. Under this scheme they do not file form 303 for that activity or recover input VAT.

Instead, their supplier charges on the invoice, in addition to VAT, a surcharge that it pays over on their behalf: 5.2% on goods at 21%, 1.4% on goods at 10% and 0.5% on goods at 4%. For example, a shoe shop buying stock for €1,000 pays €210 of VAT plus €52 of surcharge, €1,262 in total. When it sells, it charges VAT to customers but does not account for it.

The scheme is simple to manage, but you should check that every supplier applies the surcharge, as the retailer remains liable if they do not.

Common mistakes and how to correct them

The most frequent mistakes we see are recovering VAT on invoices without your details or on personal expenses, charging 21% on exempt services, forgetting to declare intra-EU acquisitions or services received from foreign suppliers, and including invoices in the wrong quarter. Transactions with other EU countries usually also require form 349 and registration on the Intra-Community Operators Register.

If you spot an error in a form 303 already filed, since the third quarter of 2024 it is corrected with an amending 303 return, whether the outcome is a payment or a refund. If the correction is in the Tax Agency's favour and you file it voluntarily, without a prior request, there is no penalty, but there is a surcharge of 1% plus a further 1% for each full month of delay, rising to 15% plus late-payment interest after 12 months.

The VAT calculator helps you check amounts before issuing an invoice, and the tax calendar ensures you do not miss a deadline. If you combine activities with different treatment, it is worth having an adviser review your set-up before year end.