Self-employed people who earn less than €85,000 will be exempt from accounting for IVA (if they choose to)

Starting in 2025, a new special VAT exemption regime will be implemented, based on Directive (EU) 2020/285.

So, which self-employed workers will be exempt from paying quarterly IVA? Self-employed people who earn less than €85,000 will not pay VAT .

That is to say, once it is implemented, self-employed workers with a turnover less than 85,000 euros per year will be exempt from this obligation.

We will have to wait until the regulations are published. At the moment, the Treasury is working together with self-employed associations to transpose the European Directive.

The European regulations would provide self-employed workers with incomes of less than 85,000 euros with the possibility of choosing between the general IVA regime or the special IVA exemption regime. The latter would allow them not to include VAT on their invoices, which in turn would mean that they would not have to declare it.

Member States will have until 2025 to implement the new fractional VAT regime .

In Spain we are still in the initial phase and the conditions are being negotiated between the Treasury and the self-employed associations and unions. This phase could last throughout 2024. Afterwards, the necessary regulations will have to be drawn up to put the franchised IVA system into practice.

Finally, it will be in force in 2025, after completing the transition period.

The full story can be found HERE

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