VAT in Intracommunity Operations. Correct Declaration in Forms 303 and 349
22 from October of the 2025
In an increasingly interconnected European single market, operations between companies from different European Union countries are commonplace. And, from now on, they must be reported correctly and in conjunction with Form 349.
The management of Value Added Tax (VAT) in intracommunity operations frequently generates uncertainty. From our office, we want to shed light on a fundamental aspect: the correct completion of Forms 303 and 349, even when the direct economic impact on the declaration seems to be nil.
What are Intracommunity Operations for VAT Purposes?
An intracommunity operation refers to the supply or acquisition of goods and the provision or receipt of services between professionals or companies (entrepreneurs or professionals) residing in different member states of the European Union. The particularity of these operations is that, under certain conditions, a mechanism known as "reverse charge" is applied.
This means that, instead of the seller or service provider charging the VAT of their country, the buyer or recipient of the service is the one who self-assesses the VAT in their own country. In Spain, for example, if a Spanish company acquires a service from a French company, the Spanish company does not receive the invoice with French VAT, but rather "charges" and "bears" the Spanish VAT simultaneously in its declaration. The final effect, in many cases, is that the VAT is canceled out at the payment level (VAT accrued and borne for the same amount), but the reporting obligation persists.
The Importance of Reflecting Operations in Form 303
Here lies the key message: although the amount of VAT to be paid or refunded in Form 303 is not affected, it is absolutely crucial to report these intracommunity operations in the corresponding boxes of your quarterly or monthly declaration.
The Tax Agency needs to have a complete and detailed record of all these transactions in order to carry out controls, cross-check information with other Member States (through Form 349 and the VIES system), and verify the correct application of exemptions and localization rules. The omission of this information, even if the economic impact on the settlement is zero, can lead to requests and possible penalties.
What should we report in Form 303?
- Input VAT on Intracommunity Acquisitions of Goods and Services: You must declare the amount of the taxable base and the VAT that you have self-assessed as input VAT for the purchase of goods or the receipt of services from other EU countries.
- Output VAT on Intracommunity Acquisitions of Goods and Services: At the same time, and generally for the same amount, you must declare the VAT that you have self-assessed as output VAT for those same acquisitions.
- Intracommunity Supplies of Goods and Intracommunity Provision of Services: If your company has sold goods or provided services to companies in other EU Member States, these operations are usually exempt from VAT in Spain, but the total taxable base of these issued invoices must be reflected in Form 303.
Beyond Form 303: Form 349
It is important to remember that the information in Form 303 is complemented by the Recapitulative Statement of Intracommunity Operations (Form 349). In this form, which is submitted monthly or quarterly (depending on the volume of operations), the information of each intracommunity client or supplier (their intracommunity VAT ID) and the amount of operations carried out with each of them are detailed. This form is vital for cross-checking between European tax administrations.
Avoid Penalties and Future Problems
Failing to correctly declare intracommunity operations in Form 303 or Form 349 is a tax infraction. Even if the Tax Agency does not lose revenue as a result (due to the neutral effect of VAT in many of these operations), the lack of information is a formal non-compliance that can lead to significant fines. Furthermore, a correct declaration is the basis for future VAT refund requests or to justify the exemption of your intracommunity supplies.
Conclusion
VAT taxation in intracommunity operations is a clear example that, in tax matters, form is as important as substance. Although the VAT to be paid or refunded in your Form 303 is not altered by these operations, its correct declaration is an unavoidable requirement for the proper functioning of the European VAT system and to avoid problems with the Tax Agency.
Do you need help with your intracommunity VAT declarations? Our team of experts is at your disposal to advise you and ensure that your company complies with all its tax obligations accurately and efficiently. Consult us!
By C.Fabri
