SHE SPANISH HERITAGE DMC

Incentives, Meetings, Conferences, Conventions, Cruise handling, Product Launches and Events
SHE DMC is a privately owned travel company specializing in providing services to the MICE segment all over Continental Spain and its Islands. As Destination Logistic Support Company, SHE DMC can provide any type of service expected from a DMC plus consultancy, coordination, event design and full or partial support to any program. Totally dedicated to service, the company integrates in the team of its clients to achieve the mutual goal of delivering a successful program.

SHE SPANISH HERITAGE DMC

Using a DMC save you VAT in Spain!

March 2015


We are pleased to announce that the new Spanish tax legislation will for sure help to bring more meetings and corporate events to Spain, especially in a time when budgets are increasingly important when it comes to take a decision about where to celebrate a meeting.

Since January 1st, a new tax legislation became effective in Spain (except on the Canary Islands which have a special tax status within the EU).

From now on clients deciding to contract a Spanish DMC to organize their meetings in Spain will have significant savings as the new law allows in certain cases the DMC to issue invoices exempt from VAT if the DMC takes care and invoices ALL the necessary services

With this new legislation it will become easier and as well more cost effective to book all the required services via a local DMC as it will not be necessary to start a tax rebate process as the DMC will be able to invoice net rates with 0% VAT. This is possible within the EU but as well when invoicing to countries where the taxes where nonrefundable due to the lack of bilateral agreements.

In which cases is it possible to get the mentioned tax refund or rather invoice with 0% taxes?
In cases where the DMC provides all the necessary elements for the organization of the event, or what the tax authority call a “Servicio Complejo de Organización de Eventos (SCOE)” which means a complete service of event organization.
Meetings and events being considered SCOE will be invoiced with 0% taxes, including this as well the services within the conference hotel.

This new law will give a huge advantage to those clients booking all services via a DMC, as they will get prices with 0% VAT. 
While if the client books only some services via a DMC the VAT taxes will have to be added to the prices and will represent a cost, as it is not considered a SCOE.

Let us see some examples about the possible savings based on a total cost of 1.000.000€.
If the client reserves the hotel directly and the DMC takes care only of the ground services, the DMC has to invoice the VAT taxes which for the client is an additional cost for the whole program BUT if the client reserves all services, including the hotel, via a DMC it is a SCOE and ALL items can be invoices with 0% VAT taxes

What could be the economic impact considering this new law:

Option A: The client books directly the hotel

  • 350.000€ invoiced by the hotel + 10% VAT taxes = total 385.000€ (B&B and F&B)
  • 250.000€ invoiced by the hotel + 21% VAT taxes = total 302.500€ (AV and Meeting space)
  • 300.000€ invoiced for ground arrangements + 21% VAT taxes = total 363.000€ (staff, venue hire, AV)
  • 100.000€ invoiced for ground arrangements + 10% VAT taxes = total 110.000€

The client will have paid 687.500€ to the hotel and 473.000 for ground arrangements. The total cost of the event will be 1.160.500€

Option B: The client books everything via the DMC
So that the event becomes a SCOE: the DMC will invoice with 0% VAT taxes.
The total cost of the event will be 1.000.000€ saving the cost of the VAT taxes with a total of 160.500€!

It is important to know that this new legislation is applicable for B2B transactions and in each case, an expert DMC has to evaluate and decide if the new law applies.

Of course, the VAT does not vanish into the air. The DMC pays the VAT to the varied suppliers and then claims it back from the Tax Authority, which of course may take for a while. So now, more than ever it is important to work with a financially solid DMC.

 

euromic Spain – SHE Spanish Heritage DMC will be delighted to analyze if your request fulfills the requirements and if it is the case we will be pleased to help you save an important amount of money

When organizing an event in Spain it is now more important than ever to contact the right partner. Right Partner Right Choice.

 

Do not hesitate to contact Spanish Heritage for your events in Spain: Mrs. Sara Merino and/or Mr. Victor Cañizares spain@euromic.com

Spain VAT FREE

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