Practical tip: set it aside in full as you get paid, because at the end of the quarter you must hand it over even if you have already spent it. How it is reported is covered in our modelo 303 guide.
As a general rule it accrues when you carry out the transaction, not when you get paid. If you issue an invoice and the customer pays late, the VAT still goes into the return for the quarter of the invoice, unless you are under the special cash accounting scheme. That is why a late payer can force you to advance VAT you have not collected yet.
The typical mistake is counting the VAT you collect as part of your turnover or profit. Your income for IRPF or corporate tax is the taxable base, without the VAT. Another slip is forgetting corrective invoices: a credit note reduces the output VAT of the period in which you issue it.
Each issued invoice goes into the register of issued invoices, and the total by rate goes into the modelo 303 for the quarter. If in a quarter you pay more VAT than you charge, the result is carried forward or refunded. In the accounts it is booked as a debt to the tax agency, not as income; kontora posts that double-entry record when each invoice is issued.
Guides that use this term
- Deferring or splitting a tax payment to Hacienda in Spain: how to apply, what can be deferred and what it costs
- Factura rectificativa (corrective invoice) in Spain: when it is mandatory, how to issue it and how to report it on the modelo 303
- How to fill in the modelo 303 box by box: a practical 2026 guide with a worked example
- Modelo 303: the Spanish quarterly VAT return, explained
Related terms
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