Can I invoice without IVA in Spain if I earn under 85,000 euros? No, and here is why

Where the 85,000 € figure comes from

The number is not invented. Directive (EU) 2020/285 created an EU wide small business VAT scheme, known in Spanish as the franquicia de IVA: each member state may allow businesses below a national threshold, capped at 85,000 € a year, to sell without charging VAT. The scheme has applied across the EU since 1 January 2025, and most countries have adopted it with their own thresholds. The Spanish tax agency itself summarises the directive on its official site.

That is where the myth is born: the figure exists in the directive and in the laws of other countries, and expat forums and automatic summaries recycle it as if it were current Spanish law. It is not. A directive does not apply by itself: each state must transpose it into national law, and Spain has not done so.

What applies in Spain today: IVA from the first euro

As of this review date, Spain is the only EU member state without a national franquicia regime. The situation went so far that the European Commission referred Spain to the Court of Justice of the European Union on 10 March 2026 for failing to transpose the directive. Until that changes, the rule is simple:

• There is no income threshold below which you can invoice without IVA in Spain.
• It makes no difference whether you bill 5,000 € or 500,000 € a year: if your activity is subject to IVA and not exempt, you charge IVA on every invoice and file your periodic returns (modelo 303).
• The only piece of the EU package that does work from Spain is the cross border side: a business established in Spain can opt into the franquicia of another member state for its sales in that country, after notifying the Agencia Tributaria through a census declaration and provided it stays under that country and EU wide limits (100,000 € across the Union). It changes nothing for your sales inside Spain.

Franquicia is not the same as an activity exemption

Here is the confusion that feeds the myth. Invoices without IVA do exist in Spain, but not because you earn little: they exist because the activity is exempt. Article 20 of the Ley 37/1992 del IVA (the Spanish VAT law) exempts certain domestic operations, among others:

• Healthcare and medical assistance services, under the terms set by the law.
• Education and training, including private tuition under certain conditions.
• Certain financial and insurance operations.
• Certain rentals and real estate operations.
• Services of certain non profit social, cultural and sports entities.

The key difference: the franquicia depends on how much you bill and does not exist in Spain; the article 20 exemption depends on what you do and applies whatever your turnover. An exempt teacher charges no IVA even billing 200,000 €; a designer charges IVA even billing 9,000 €.

What happens if you invoice without IVA believing the myth

Invoicing without IVA does not free you from the tax: it makes you the one who owes it. If Hacienda (the Spanish tax authority) reviews your activity and concludes you should have charged IVA, the usual consequences are these:

• You still owe the IVA. Hacienda will demand the uncollected amounts for all non prescribed years, and in practice they come out of your own pocket: recovering that IVA from past clients is almost never feasible.
• Plus late payment interest for all the time elapsed.
• Plus, depending on the case, surcharges (recargos) or penalties, whose size depends, among other things, on whether you correct the situation voluntarily or Hacienda acts first.
• You will also have to rectify invoices and returns, with all the administrative cost that implies.

The short version: a forum post saying you are safe under 85,000 € is not a defence. If you have already invoiced without IVA by mistake, correcting it voluntarily before Hacienda calls is always cheaper; an advisor can help you quantify the exact impact.

What if Spain transposes the franquicia one day?

It may happen, and the pressure is real: the directive has applied in the rest of the Union since 2025 and Spain now faces proceedings before the Court of Justice. But as of this review date there is no law, no approved bill and no date. One important nuance: the directive allows each state to create the domestic franquicia, it does not oblige it to. So even once Spain complies with the transposition, a Spanish no IVA turnover threshold is not guaranteed.

If it ever arrives, it will be a rule published in the BOE (the Spanish official gazette), with its own threshold, conditions and calendar. At kontora we watch the BOE daily for exactly this reason: if a Spanish franquicia regime is approved, you will know without chasing headlines. Until then, the correct answer remains the one at the top: in Spain you invoice with IVA from the first euro, unless your activity is exempt.

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