Short answer: to add VAT, multiply the base by 1.21 (21%), 1.10 (10%) or 1.04 (4%). To remove it, divide the total by the same number. A €500 base at 21% becomes €605, of which €105 is VAT.
If you freelance or run a small business in Spain, every invoice involves VAT (IVA in Spanish) and often a second figure that surprises newcomers: the IRPF withholding. The maths is simple, but the concepts are easy to mix up. This guide covers the formulas, the 2026 rates, a complete freelance invoice and the special cases: EU clients and the equivalence surcharge.
How VAT works on an invoice
VAT is a consumption tax. You charge it to your client and pass it on to the tax office (Agencia Tributaria); it is never your income. The VAT you charge is output VAT (IVA repercutido), and the VAT you pay on business costs is input VAT (IVA soportado). Each quarter you file form 303 and pay the difference.
Every invoice shows three figures: the taxable base (base imponible, the price before tax), the VAT amount (cuota, base × rate) and the total (base + VAT).
VAT formulas
- Add VAT: total = base × (1 + rate / 100). €500 at 21%: 500 × 1.21 = €605.
- Remove VAT (VAT-inclusive price): base = total / (1 + rate / 100). €605 / 1.21 = €500.
- VAT amount only: VAT = base × rate / 100. 500 × 21 / 100 = €105.
A common mistake is removing VAT by subtracting 21% from the total: €605 − 21% = €477.95, not €500. Always divide.
VAT rates in Spain in 2026
| Rate | % | Main examples |
|---|---|---|
| Standard | 21% | Professional services, clothing, electronics, cars, telecoms, hairdressing, alcohol and sugary drinks |
| Reduced | 10% | Most food, restaurants and hotels, passenger transport, new housing, cinema, theatre and museum tickets, water |
| Super-reduced | 4% | Bread, milk, eggs, fruit and vegetables, olive oil, books and newspapers, medicines, sanitary products |
| Exempt | — | Healthcare, regulated education, insurance, financial services, residential rent |
Worked example: a freelance invoice with VAT and IRPF
A freelance graphic designer invoices a Spanish company €800 for a project. The invoice adds 21% VAT and subtracts 15% IRPF withholding:
| Item | Amount |
|---|---|
| Taxable base | €800.00 |
| + VAT (21%) | €168.00 |
| − IRPF withholding (15%) | €120.00 |
| Amount to be paid | €848.00 |
The designer receives €848, but €168 is VAT owed in the quarterly form 303. The company keeps the €120 and pays it to the tax office on form 111, as an advance on the designer’s income tax. Both VAT and IRPF are calculated on the base, never on each other.
When does IRPF withholding apply? When a professional (designers, consultants, developers, lawyers and other activities in section 2 of the IAE) invoices a Spanish company or another autónomo. It does not apply to private clients or foreign clients. The rate is 15%, or 7% in the year you start and the two following years. If you are self-employed, our guide to autónomo tax in Spain explains how this fits with your quarterly payments.
What a valid Spanish invoice must include
- Invoice number (and series, if used), in sequence.
- Issue date, and the date of the operation if different.
- Name, tax ID (NIF/NIE) and address of both issuer and client.
- Description of goods or services, with unit prices and discounts.
- Taxable base, VAT rate and VAT amount, broken down by rate.
- If no VAT is charged, the reason and legal reference for the exemption.
Sales to consumers of up to €400 (VAT included) can use a simplified invoice, without the client’s details.
Invoicing clients in other EU countries
If your client is a business in another EU country with a valid VAT number registered in VIES, you do not charge Spanish VAT:
- Services: not subject to Spanish VAT (article 69 of the VAT Act). The client accounts for VAT in its own country under the reverse charge.
- Goods: an exempt intra-community supply (article 25 of the VAT Act).
Show the client’s VAT number and the legal mention on the invoice and report the operation on form 349. You also need to be registered as an intra-community operator yourself (form 036). For private clients in the EU, Spanish VAT is generally charged.
The equivalence surcharge (recargo de equivalencia)
Selling to a self-employed shop owner? They may be in the equivalence surcharge scheme, which means adding an extra charge on top of VAT: 5.2% with 21% VAT, 1.4% with 10% and 0.5% with 4%. For example, €1,000 at 21%: €1,000 + €210 VAT + €52 surcharge = €1,262. The retailer does not file VAT returns; you collect and pay the surcharge.
Common mistakes
- Subtracting 21% to remove VAT instead of dividing by 1.21.
- Calculating IRPF on the total with VAT: it always applies to the base.
- Applying the wrong rate: some services sound “reduced” but are 21% (hairdressing, veterinary services).
- Declaring VAT only when paid: under the general rule, VAT is due when you invoice, even if the client has not paid yet (unless you opted for the cash accounting scheme).
Frequently asked questions
How do I calculate VAT on an invoice in Spain?
To add VAT: total = base × (1 + rate/100). To remove VAT: base = total / (1 + rate/100). For a €500 base at 21%: €500 × 1.21 = €605, of which €105 is VAT.
What are the VAT (IVA) rates in Spain in 2026?
21% standard, 10% reduced (most food, restaurants and hotels, transport, new housing) and 4% super-reduced (bread, milk, fruit and vegetables, olive oil, books, medicines). Healthcare, regulated education, insurance and residential rent are exempt.
Why does a freelance invoice in Spain subtract 15%?
It is the IRPF withholding: when a professional invoices a Spanish company or another autónomo, the client withholds 15% of the base (7% in the first three years) and pays it to the tax office for you. VAT is added; IRPF is subtracted.
Do I charge Spanish VAT to clients in other EU countries?
Not to businesses with a valid EU VAT number (VIES): services fall under the reverse charge and goods are an exempt intra-community supply. Report them on form 349. Private EU clients are generally charged Spanish VAT.
What is the recargo de equivalencia?
An extra charge on sales to self-employed retailers in that scheme: 5.2% with 21% VAT, 1.4% with 10% and 0.5% with 4%. The retailer does not file VAT returns.
What is the difference between output VAT and input VAT?
Output VAT is what you charge; input VAT is what you pay on business costs. Each quarter, form 303 settles the difference.
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