The Executive commits to applying VAT exemption to freelancers earning less than 85,000 euros to secure Junts' vote on the aid decree for the war. Spain is the last country in the EU that has not adapted the directive.
The Government has committed to applying VAT exemption to freelancers who earn less than 85,000 euros annually. The announcement, according to infoautonomos.com, aims to secure Junts' vote to validate the aid decree for the war.
The measure is not a voluntary gesture. Spain is the last country in the European Union that has not adapted Directive (EU) 2020/285, which requires offering a simplified regime for small businesses and professionals. The deadline was 1 January 2025 and Brussels has already taken the case to the European Court of Justice on 11 March. The country faces multi-million euro fines and daily penalties for each day of delay.
The new exemption regime would have three main effects for freelancers. The first is that they would stop including VAT in their invoices, allowing them to lower prices or increase their margin if they maintain their rates. The second is the elimination of the model 303 quarterly, which would be replaced by an annual informative declaration for the tax office to verify that income limits are not exceeded. The third is the downside: by not charging VAT, freelancers lose the right to deduct VAT on their purchases, so for profiles with many operational expenses, such as transporters or certain businesses, the general regime might still be more profitable.
Implementing this requires a profound restructuring of the IT systems of the Tax Agency. Some analysts suggest that a serious rollout could only begin at the start of the year. If the Government accelerates the procedures before the August break, the goal of January 2027 would be ambitious but possible. The mention of 2028 as a horizon raises doubts about whether this is a genuine desire for reform or a strategy to buy time before European courts and parliamentary partners.
For freelancers, the measure would mean stopping the daily management of VAT and eliminating quarterly paperwork. The final timetable depends on parliamentary processing and the IT adaptation of the tax office, which still has no official date.
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