The Canary Islands' unique tax system, known as IGIC (Impuesto General Indirecto Canario), serves as the region's version of Spain's VAT. Established in January 1993, IGIC is a general indirect tax applied to consumption within the Canary Islands, including its territorial sea and airspace. While it functions similarly to mainland Spain's VAT, IGIC operates under a distinct set of rules and tax rates.
Indirect tax on Canary Islands—how is it regulated?
Public
Spain
Author: Nikolina Basic
Category:
Fiscal subject related
Views:
2796
Content accuracy validation date:
15.08.2024
Content accuracy validation time:
09:11h
Unlike the three-tier system of VAT, IGIC encompasses six different tax rates: 0%, 3%, 7%, 9.5%, 15%, and 20%. These lower tax rates and broader range of categories make IGIC more favorable for consumers and businesses in the Canary Islands. Each rate is designed to apply to specific goods and services, allowing for more nuanced taxation that benefits various sectors uniquely.
Entities required to declare IGIC include SMEs, self-employed workers, and any businesses involved in operations subject to IGIC in the Canary Islands. These declarations are essential for maintaining compliance with local tax regulations and ensuring accurate tax reporting. Form 420 is used by SMEs and self-employed workers to declare IGIC, while Form 415 is used for informative declarations related to IGIC tax. These forms ensure that all relevant transactions and tax liabilities are accurately reported and managed.
The benefits of IGIC for businesses include lower tax rates, ZEC exemptions, reduced corporate tax rates, and incentives like the Reserva Inversiones de Canarias (RIC) that promote economic growth and development in the Canary Islands. This structure not only supports local businesses but also encourages economic growth and development in the region.
Other news from Spain
The Spanish tax administration launched an inspection campaign regarding VeriFactu compliance.
Public
Spain
Author: Nikolina Basić
Spain
Author: Nikolina Basić
The Spanish Tax Agency has launched an inspection campaign targeting dual-use invoicing software ahead of the July 29, 2025 Verifactu compliance deadline, emphasizing its crackdown on tools that enable invoice manipulation. From July 30 onward, all new or updated invoicing software must fully comply with Verifactu standards, with non-compliance risking fines of up to €150,000. Regarding deadlines... Read more
What data must the SIF (POS) producer in Spain include in the Certification?
Spain
Author: Nikolina Basić
Under Spain’s Royal Decree 1007/2023 and Article 29.2.j) of the LGT, billing system producers (SIF) must comply with new certification requirements, including detailed disclosures about their software and company. To support this, the Spanish Tax Agency (AEAT) has published example templates to guide producers in submitting proper declarations. Read more
Subscribe to get access to the latest news, documents, webinars and educations.
Already subscriber? Login
Billing record retention under the VERI*FACTU System-clarification
Spain
Author: Nikolina Basić
A recent clarification on VERI*FACTU confirms that invoice records are immediately submitted to Spain’s Tax Agency (AEAT) for secure, unalterable storage, eliminating a strict legal obligation for businesses or developers to retain separate copies. However, as not all invoice details—such as individual billing lines—are captured in the system, companies may still choose to retain full copies for internal and operational purposes. Read more
Subscribe to get access to the latest news, documents, webinars and educations.
Already subscriber? Login
Fiscalization in Spain: How to process in the event of some errors, corrections, and cancellation of invoices in accordance with new fiscalization requirements?
Spain
Author: Nikolina Basić
Under Spain’s new fiscalization rules, invoice errors must be addressed based on their timing and nature, with simple corrections allowed before issuance. Once issued, errors covered by Royal Decree 1619/2012 require a corrective invoice with specific RF codes, while internal billing errors or invalid invoices may require internal corrections or cancellations, applied only in exceptional cases. Read more
Subscribe to get access to the latest news, documents, webinars and educations.
Already subscriber? Login
Are vending machines subjects of fiscalization in Spain?
Spain
Author: Nikolina Basić
In Spain, vending machines are generally subject to fiscalization and must issue simplified invoices in compliance with VERIFACTU or NO VERIFACTU formats. Let's delve deeper into this topic! Read more
Subscribe to get access to the latest news, documents, webinars and educations.
Already subscriber? Login
New webinar was uploaded: Recorded webinar: EV Chargin in Europe - Green Growth Meets Fiscal Reality
Author: Gordana Lakić
On June 19th, 2025, Fiscal Solutions organized a free webinar on the topic of "EV Charging in Europe—Green Growth Meets Fiscal Reality." The webinar was held by Fiscal Solutions Sales Manager Gordana Lakić. Let’s find out more on this! Read more
Subscribe to get access to the latest news, documents, webinars and educations.
Already subscriber? Login
What contains the example declaration of certification document for POS SW for Spain’s fiscalization?
Spain
Author: Nikolina Basić
Spain’s AEAT has published a model responsible declaration for POS software providers to certify compliance with the VERI*FACTU fiscalization framework, referencing Royal Decree 1007/2023 and Order HAC/1177/2024. Let's find out more about the required details. Read more
Subscribe to get access to the latest news, documents, webinars and educations.
Already subscriber? Login