Form 303: the VAT for each quarter
It is the form filed most often in Spain and the one that raises the most questions. Underneath, it does a subtraction: the VAT you charged minus the VAT you paid. What is complicated is everything that creeps in at the edges.
What form 303 is
Form 303 is the VAT self-assessment. In each period you declare the tax you charged your clients — the repercutido — and the tax you paid your suppliers — the soportado —, and the difference is either paid over or carried forward to offset.
The underlying idea is that the VAT is never yours: you collect it on Hacienda's behalf and you pay it over. And that is why it is the form that causes the most grief to anyone who does not set that money aside: they spend a VAT that was never theirs.
Who has to file it
Any business person or professional carrying out transactions subject to VAT. With exceptions worth knowing about:
- Anyone on recargo de equivalencia does not file a 303 for that activity: the retailer pays the surcharge on their purchases and that settles it.
- Exempt activities — regulated education, healthcare, some activities of non-profit bodies — do not charge VAT, and anyone who only does that does not file.
- In the Canary Islands it is IGIC, and in Ceuta and Melilla, IPSI: a different tax and different forms.
And one that catches people out: you have to file it even if you have not invoiced anything. If you are registered, a quarter with no activity is filed all the same, by ticking that box. Not filing because nothing moved is one of the things that ends in a formal query.
When the 303 is filed
With the weekend shifts already applied: when the last day falls on a Saturday, a Sunday or a public holiday, the deadline ends on the next working day.
| Period | Deadline | Note |
|---|---|---|
| First quarter | 1 → 20 April | Direct debit, until the 15th |
| Second quarter | 1 → 20 July | Direct debit, until the 15th |
| Third quarter | 1 → 20 October | Direct debit, until the 15th |
| Fourth quarter | 1 → 30 January | Careful: it is not due on the 20th. Direct debit, until the 25th |
| Monthly (SII, REDEME and anyone invoicing more than €6,010,121.04) | Until the 30th of the following month | Except the January one, which runs to the last day of February |
Amounts payable can be paid by direct debit, but the direct debit deadline ends five days before the filing deadline: until the 15th in April, July and October, and until the 25th in January. It is an expensive slip and a very common one in the fourth quarter.
How it is worked out
The skeleton is simple and fits in four lines:
- Output VAT: the total VAT on all the invoices you issued in the period, split by rate (21%, 10%, 4%).
- Deductible VAT: the VAT on your expenses and purchases, provided they are deductible and you have the full invoice.
- Difference: if it comes out positive, you pay it; if it comes out negative, it is carried forward to offset in later periods — or you claim the refund in the last quarter of the year.
- Less anything carried forward to offset from earlier periods.
What complicates the subtraction
- The prorrata. If you carry out both exempt and non-exempt activities, you do not deduct all your input VAT, only a percentage. It is worked out provisionally from the previous year's figures and adjusted in the last quarter.
- Capital goods. A major purchase is adjusted over four years — nine if it is a property — if the prorrata changes.
- The reverse charge. On construction work, scrap metal or certain electronic products, the invoice arrives without VAT and you declare it yourself, in two boxes at once: you charge it to yourself and you deduct it.
- Intra-Community transactions. A purchase from a supplier in another European Union country works the same way: it goes in through two boxes.
- The cash basis regime. If you are on it, VAT becomes chargeable when you are paid and not when you invoice, and you have to keep track of the payments received.
The mistakes that come up most on the 303
Almost none of them is an arithmetic error. They are errors about what goes in and what does not.
Deducting an expense without a full invoice
A till receipt does not give you the right to deduct VAT. You need an invoice with your tax details and the VAT shown separately. It is the number one reason a tax check ends in an assessment.
Not filing the quarter with no activity
If you are registered, the 303 is filed even if you have not invoiced. There is a box for that. Not filing costs more than the minute it takes.
Forgetting the prorrata adjustment
Anyone with both exempt and taxable income applies a provisional percentage all year and has to adjust it in the fourth quarter. Almost nobody remembers.
Setting up the direct debit too late
The direct debit deadline ends five days before the filing deadline. Miss it and you have to pay with an NRC, the bank's payment reference; miss that too and you are already late.
Screenshot of the ERP: the form 303 screen
Where every number on the 303 comes from
Nothing has to be typed in again: the form is worked out from the invoices and the expenses you have already entered during the period.
- Output VAT comes from the invoices you issued, split by rate.
- Input VAT comes from your expenses, with a warning if any of them is missing its invoice.
- The prorrata is worked out and adjusted on its own in the fourth quarter.
- The reverse charge and intra-Community transactions go into their own boxes.
- Every box opens up to show which invoices make it up.
- And it warns you before the direct debit deadline, not the filing one.
And you can open any box
Every amount on the form can be expanded to see exactly which invoices and which expenses make it up. That is what turns a figure into something you can defend if you are asked.
The 303 comes out of what you have already entered
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Questions about form 303
This page is for information and is reviewed whenever the legislation or the calendar changes. It does not replace your accountant: for your own case, ask someone who knows your numbers.
So the 303 stops taking an afternoon
If the invoices and the expenses are in, the form is already done.
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