Spain - Tax Treatment of Live Services

July 25, 2024

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The Spanish Tax Agency (TA) has issued an official answer concerning the taxation of a service consisting of retransmitting live events for viewing through an online platform. The Spanish TA uses this practice frequently, and these answers provide valuable sources of information to all parties to which these rules apply.

Tax Authority Interpretation

The Spanish TA concludes that the service of live event streaming through an online platform is considered an electronically provided service. This conclusion is preceded by the opinion that when an online platform facilitates the distribution of viewing acts on behalf of purchasers, it is considered to have received and provided the services.

According to Article 9a of Implementing Regulation 282/2011 (EU), the digital platform operator becomes a supplier when services are delivered electronically through a telecommunications network, interface, or portal. This presumption holds unless the provider is explicitly acknowledged as such by the taxable person, and this recognition is documented in the contractual agreements between the parties.

In addition, the services supplied to the platform will be considered located within the Spanish tax territory if the platform has its headquarters, a permanent establishment, or, in the absence of these, its usual residence or domicile in that area, provided that the services are directed to said headquarters, establishment, residence, or domicile.

Conclusion

In summary, the online platforms that facilitate the distribution of viewing services are deemed to be the recipients and providers of these services when acting on behalf of purchasers. This provides clarity for service providers and ensures alignment with the principles set out in Article 9a of Implementing Regulation 282/2011 (EU).

Businesses retransmitting live events via online platforms should carefully review their contractual arrangements and operational locations to ensure compliance with these tax rules.

Source: Spanish Tax Agency, Implementing Regulation (EU) No 282/2011

What are the penalties for errors in VAT returns in Denmark?

In Denmark, submitting incorrect VAT returns can result in a correction surcharge of up to 30% interest on the owed VAT amount. This legislation, approved by the Danish Parliament on June 9, 2022, aims to encourage businesses to ensure their VAT reports are accurate and submitted on time.

How far back can the Danish Tax Agency apply surcharges for VAT errors?

The Danish Tax Agency can apply surcharges to VAT returns submitted up to 36 months prior to the correction. However, specific dates for this application have not been specified, allowing companies a grace period to correct older reports without immediate penalties.

Are both over-declarations and under-declarations subject to penalties?

Yes, both over-declarations and under-declarations are considered reporting errors in Denmark. Businesses must correct these errors, which can result in penalties regardless of whether the mistake led to overpaying or underpaying VAT.

What happens if a business fails to submit a VAT report in Denmark?

If a business does not submit a VAT report, the Danish Tax Office will estimate the VAT due and charge the company a fee of DKK 800 for this service. The company is then responsible for correcting the estimated data to reflect the accurate VAT owed.

Are there additional penalties for missing VAT reporting deadlines?

Yes, missing VAT reporting deadlines can lead to multiple penalties, including surcharges, fees for VAT calculation by the tax authorities, and the obligation to pay the estimated VAT due. These combined penalties can pose significant financial risks to businesses.

How can businesses avoid VAT surcharges and penalties in Denmark?

To avoid surcharges and penalties, businesses should strive to submit accurate and timely VAT reports. Collaborating with trusted VAT compliance partners can help ensure that reporting processes are thorough and error-free, thereby mitigating the risk of incurring penalties.

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