The current VAT management system has been in operation, with the necessary adaptations, for more than 30 years. However, current technology now makes it possible to implement a new VAT Immediate Supply of Information system (SII), thereby improving tax control and assisting taxpayers in meeting their obligations.
Recent amendments to the VAT Regulations introduce this new system for managing Value Added Tax, based on keeping the VAT ledgers through the Spanish Tax Agency (AEAT) electronic office and submitting invoicing records almost immediately.
The “Immediate Supply of Information” (SII) represents a substantial improvement in communication between the Administration and taxpayers, since it will enable a two-way, automated and immediate relationship. It is also a new tool both for assisting taxpayers and for improving the efficiency of tax control.
What is the SII project?
It changes the current VAT management system by requiring VAT ledgers to be kept through the AEAT Electronic Office, with invoicing records submitted IMMEDIATELY. This brings the recording of invoices closer to the time when the underlying economic transaction actually takes place.
NOTE: The invoice itself is not sent, and this is not electronic invoicing.
In essence, the SII consists of the electronic submission of invoicing records forming part of the VAT ledgers. The relevant invoicing details must be sent to the AEAT electronically (through web services based on XML message exchange or, where appropriate, by using a web form). The information is then used to build the various ledgers almost in real time. Taxpayers do not send the invoices themselves.
Issued or received simplified invoices may be grouped, provided the relevant requirements are met, and the invoicing records may be submitted as a summary entry.
Deadlines and frequency for submitting invoicing records
- Invoices issued: The invoicing record must be submitted within 4 calendar days, excluding Saturdays, Sundays and national public holidays, from the invoice issue date. In all cases, it must be submitted before the 16th day of the month following the tax point.
In 2017, the submission period will be 8 days.
- Invoices received: The invoicing record must be submitted within 4 calendar days, excluding Saturdays, Sundays and national public holidays, from the date the invoice or Single Administrative Document (DUA) is entered in the accounts. In all cases, it must be submitted before the 16th day of the month following the date on which the right to deduct arises.
In 2017, the submission period will be 8 days.
Information to be submitted to the SII
The “invoices” themselves are NOT submitted; the taxpayer submits the invoicing information.
- Records: the ledgers for issued and received invoices, investment goods and certain intra-Community transactions.
- Ledger of issued invoices:
- Invoice number and, where applicable, series shown on the invoice (invoice identification): this is the key element for matching the transaction, together with the issue date and the issuer’s tax identification number (NIF).
- Issue date and, if different, the date on which the transactions took place.
- Recipient’s first and last name or company name, and NIF.
- Taxable amount and VAT due.
- Type of invoice issued (full, simplified or corrective).
- Description of the transactions.
- For corrective invoices, a reference to the corrected invoice (optional) or the amounts being adjusted.
- Tax classification of the transactions included in the invoice: non-taxable and exempt transactions; supplies of goods or services (only for transactions involving non-established persons).
- Special schemes: those under points (j) and (l) to (p) of Article 6 of the Invoicing Regulations, the special scheme for investment gold, and the special group-of-entities scheme (REGE).
- Invoicing agreement.
- One of the categories of transactions with tax relevance (Articles 33 to 36 of the General Tax Management Regulations, RGAT).
- Ledger of received invoices:
- Invoice number and, where applicable, series.
- Imports: DUA number and accounting date.
- Issue date and, if different, the date on which the transactions took place.
- Issuer’s first and last name or company name, and NIF: invoice identification.
- Taxable amount.
- Deductible VAT.
- Description of the transaction.
- Special schemes: those under points (l) to (p) of Article 6 of the Invoicing Regulations and the REGE.
- One of the categories of transactions with tax relevance (Articles 33 to 36 of the RGAT).
What are the objectives of the SII project?
- Improve the efficiency of tax control.
- Assist taxpayers:
- Phase 1: tax data.
- Phase 2: assistance/draft VAT return.
Who is required to use the SII?
The group required to use the SII consists of all taxable persons required to file monthly VAT returns:
- Large companies (turnover exceeding €6 million).
- VAT groups.
- Persons registered in the Monthly VAT Refund Register (REDEME).
This group currently has developed software systems that can be adapted to meet the requirement to submit invoicing records within four days (excluding Saturdays, Sundays and national public holidays).
During the second half of 2017, taxpayers will have an extended period of eight days to submit the information (excluding Saturdays, Sundays and national public holidays).
Any other taxable person may also opt into the system. This option means that VAT returns must be filed monthly and that the taxpayer must remain in the system for at least the calendar year for which the option is exercised. The option to use the SII must be exercised in November before the calendar year in which it is to take effect. For 2017, the option had to be exercised during June of that year.
The new system is expected to affect around 63,000 taxpayers, representing approximately 80 per cent of the country’s total business turnover.
Benefits of the system
- High-quality information will be available quickly enough to streamline VAT management.
- Tax data will be available because taxpayers will have one “reported” ledger and another “matched” ledger in the AEAT Electronic Office, compared against information from third parties within the system or from the AEAT database. Taxpayers will be able to check this information before the deadline for filing their monthly VAT return and correct errors in their submissions without first being asked to do so by the AEAT.
- Fewer information requests from the AEAT, since many current requests seek the ledgers, invoices or information contained in them to check particular transactions.
- Modernises and standardises the way traditional VAT ledgers are kept.
- Reduces formal obligations by removing the requirement to file forms 347, 340 and 390.
- Shortens VAT refund processing times because the AEAT receives more detailed information about transactions in almost real time.
- Taxpayers included in the new system will have their VAT return filing and payment deadlines extended by 10 days.
- The deadline for filing monthly VAT returns is extended to the first 30 calendar days of the month following the tax period.
Implementation schedule
- Testing phase: January to June 2017.
- April: web form, available from 7 April 2017.
- May: matching service available from 17 May.
The SII system entered into force on 1 July 2017.
