In a globalized market, having clients beyond your borders is excellent news for any freelancer or SME. However, this international expansion comes with a series of tax obligations that are crucial to understand. Invoicing a client in Berlin is not the same as invoicing one in Buenos Aires or Barcelona. Proper management of VAT and invoice details will help you avoid problems with the Spanish Tax Agency (AEAT).
Invoicing Clients within the European Union (EU)
The key here is to distinguish whether your client is a business (B2B) or a private individual (B2C).
* If your client is a business (B2B): The general rule is the reverse charge mechanism. This means you issue the invoice without VAT. To do this, both parties must be registered in the Registry of Intra-Community Operators (ROI). Before invoicing, always verify their VAT number in the VIES system. Your invoice must include the note: "Operation subject to the reverse charge mechanism".
* If your client is a private individual (B2C): As a general rule, Spanish VAT applies. However, if you provide digital, telecommunications, or broadcasting services and exceed €10,000 in annual turnover to the entire EU, you must charge VAT in your client's country. To simplify this, you can register for the One-Stop Shop (OSS) system.
Invoicing Clients Outside the European Union
When you invoice a client located outside the EU, the transaction is considered an export of services or goods.
These operations are exempt from VAT. Therefore, your invoice should not include this tax. It is essential to include a note on the invoice justifying the exemption, such as: "VAT-exempt operation under Article 21 of the Spanish VAT Law 37/1992". Make sure you can prove that the service was provided or the goods were delivered to a third country.
Essential Information for Your International Invoice
Regardless of the destination, every international invoice must contain:
- Your full tax details (name, NIF, address).
- The client's full tax details (name, VAT number, address).
- Invoice number and issue date.
- A clear description of the service or product.
- Taxable base.
- VAT rate (0% or exempt) and the legal justification for it.
The Arrival of VeriFactu and Electronic Invoicing
The way we invoice is about to change dramatically, and this also affects international invoices. The VeriFactu system, aimed at combating tax fraud, will become mandatory for everyone.
Remember the key dates:
- January 1, 2027: Mandatory for corporations and companies.
- July 1, 2027: Mandatory for freelancers and micro-SMEs.
From then on, you will no longer be able to use Excel or Word. You must use VeriFactu-compliant invoicing software that generates invoices with a QR code and communicates them to the AEAT. This requirement applies to all invoices you issue, including those to clients abroad. Adapting in advance is key to avoiding penalties and ensuring a smooth transition. You can find all the details in the deadlines and guide for VeriFactu in 2027.
In summary, invoicing internationally requires attention to detail, especially regarding VAT. Using up-to-date invoicing software will not only help you comply with these rules but will also prepare you for the imminent arrival of mandatory electronic invoicing.