I

1. Article 119 bis of Law 37/1992, of December 28, on Value Added Tax, constitutes the transposition of the content of the thirteenth Council Directive 86/560 / EEC, of ​​November 17, 1986, in matter of harmonization of the laws of the Member States relating to taxes on turnover-Modalities of refund of Value Added Tax to taxable persons not established in the territory of the Community, or in the Canary Islands, Ceuta or Melilla.

Said provision recognizes businessmen or professionals not established in the territory of application of this tax the right to refund the Tax that they have paid or, where appropriate, have borne in said territory, in accordance with compliance with certain requirements and limitations.

Since 1 February 2020, the United Kingdom of Great Britain and Northern Ireland, hereinafter referred to as ‘the United Kingdom’, has ceased to be part of the European Union and has become considered a third State. The Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community, hereinafter referred to as the “Withdrawal Agreement”, provides for a transitional period ending on 31 December 2020. In addition, the Withdrawal Agreement incorporates a specific Protocol on Ireland / Northern Ireland to respond to very specific situations in these territories.

As of January 1, 2021, businessmen or professionals established in the United Kingdom and not established in the territory of application of the Tax, nor in the Community, Canary Islands, Ceuta or Melilla, may request the refund of the Tax quotas on the Added Value that they have borne for the acquisitions or imports of goods or services made in said territory, when the conditions and limitations provided in article 119 of Law 37/1992 concur.

2. Additionally, the aforementioned article 119 bis conditions the return of the tax to the fulfillment of the following requirements:

1.º Applicants must appoint in advance a representative who is a resident in the territory of application of the Tax who will have to comply with the corresponding formal or procedural obligations and who will be jointly and severally liable with those in cases of improper refund. The Public Treasury may demand from said representative sufficient surety for these purposes.

2.º Said applicants must be established in a State where there is reciprocity of treatment in favor of businessmen or professionals established in the territory of application of the Tax, the Canary Islands, Ceuta and Melilla.

The recognition of the existence of reciprocity of treatment referred to in the previous paragraph will be made by resolution of the General Director of Taxes of the Ministry of Economy and Finance.

3.º By exception to the provisions of the previous number, any non-established businessman and professional referred to in this article may obtain a refund of the tax quotas borne with respect to imports of goods and the acquisitions of goods and related services. to:

• – The supply of templates, molds and equipment acquired or imported in the territory of application of the tax by the entrepreneur or non-established professional, for making them available to an entrepreneur or professional established in said territory to be used in the manufacture of goods that are dispatched or transported outside the Community to the non-established employer or professional, provided that at the end of the manufacture of the goods they are shipped to the non-established employer or professional or destroyed.
• – Access, hospitality, catering and transport services, linked to attending trade fairs, congresses and exhibitions of a commercial or professional nature that are held in the territory of application of the Tax. “

3. Article 3, paragraph two, number 2, of the Tax Law provides that, for the purposes of this tax, “Community” is the set of territories that make up the “interior of the country” for each Member State.

It follows from the aforementioned Withdrawal Agreement that the territories of the United Kingdom are not part of the Community. However, the territory of Northern Ireland will be part of the Community as regards supplies, intra-Community acquisitions and imports of goods.

4. In the case of businessmen or professionals established in the United Kingdom, and not established in the territory of application of the Tax, nor in the Community, Canary Islands, Ceuta or Melilla, the right to refund is conditioned on the specific requirement that reciprocity of treatment in favor of businessmen or professionals established in the territory of application of the Tax is accredited.

For this, it is necessary to compare the specific regulation contained in the United Kingdom legislation on the refund of the Tax to entrepreneurs or professionals not established in that territory, excluding the territory of Northern Ireland only in relation to operations on goods, adapting the Refunds authorized by the Spanish Tax Administration to those recognized by the United Kingdom, for which purpose the information provided by the United Kingdom Tax Administration has been collected through its website.

In this sense, this General Directorate has obtained the following information:

• In general, the conditions under which the fees paid in the territory of the United Kingdom are returned by businessmen or professionals established in the territory of application of the Tax in Spain are equivalent to those stipulated by Law 37/1992 for the refund of the Tax quotas borne or paid by businessmen or professionals established in the territory of the United Kingdom.
• However, based on the information provided by the UK authorities, the following differences have been found:

In the territory of the United Kingdom, there will be no refund of paid or paid fees:

1. a) For goods and services acquired that do not affect business or professional activity.
2. b) For goods and services that are intended for resale.
3. c) For goods and services that refer to entertainment or services of a recreational nature.
4. d) For the acquisition of a motor vehicle.
5. e) 50 percent of the input VAT, for the rental or financial leasing of a motor vehicle.

5. Notwithstanding the foregoing, for entrepreneurs or professionals not established in the territory of application of the Spanish tax but established in the territory of Northern Ireland, while the specific Protocol of said territory is in force, insofar as it refers to acquisitions of goods or imported goods, the return of the fees borne in the Spanish territory of application of the Tax will be governed by the provisions of article 119 of Law 37/1992, which involves the transposition of Directive 2008/9 / EC of the Council, of February 12, 2008, which establishes applicable provisions relating to the refund of value added tax, provided for in Directive 2006/112 / EC, to taxpayers not established in the Member State of return, but established in another Member State.
6. The State Tax Administration Agency, in writing dated September 2, 1996, reported favorably on the advisability of the General Directorate of Taxes adopting a resolution indicating the territories not belonging to the European Union in which there is reciprocity for the purposes of the Refund of Value Added Tax to taxpayers not established in their territory.
7. In any case, it should be remembered that the refund of the Tax to businessmen or professionals not established in the territory of application of the Tax, or in the Community, the Canary Islands, Ceuta or Melilla, is conditional on compliance with the requirements set forth in the article 119 bis of the Law on Value Added Tax, and that it must be authorized according to the procedure established in article 31 bis of the Regulation of said Tax, approved by Royal Decree 1624/1992, of December 29.

II

In accordance with all of this, this General Directorate considers the following Resolution in accordance with the Law:

First. For the purposes of refunding Value Added Tax to businessmen or professionals established in the territory of the United Kingdom, other than Northern Ireland, it will be understood that there is the reciprocity referred to in article 119 bis, number 2. , of Law 37/1992, of December 28, on Value Added Tax, without it being necessary, therefore, to provide documentation that justifies it, although the limitations or conditions referred to in the section I, point 4, ordinal 2nd above, in compliance with the aforementioned principle of reciprocity.

In addition, for the purposes of refunding Value Added Tax to businessmen or professionals established in the territory of Northern Ireland, it will be understood that there is the reciprocity referred to in article 119 bis, number 2, of the aforementioned Law 37/1992, of December 28, regarding the fees paid for services located in the territory of application of the Tax, without it being necessary, therefore, to provide documentation that justifies it, although the limitations or conditions referred to in section I, point 4, ordinal 2nd above, in compliance with the aforementioned principle of reciprocity.

Second. The authorization of the refund of the Tax referred to in the previous section will be conditioned on strict compliance with the requirements and procedures provided for in articles 119 bis of the Tax Law and 31 bis of the current Regulation issued for its development.

Third. Refund authorizations will only proceed with respect to requests that are submitted from the date of this Resolution, when they refer to Tax installments accrued after the same and provided that they have been requested within the terms and in the manner established by regulation.