Complete guide to the domestic reverse charge. Learn which services qualify, how to invoice correctly, and how to account for IVA in Boxes 1 and 4.
Mandatory
If Qualified
21%
Tipo General
Inversión del Sujeto Pasivo
Often Used
Zero IVA
On Invoice
Inverso charge means the cliente (contratista) se convierte en responsable for IVA en lugar de the proveedor (subcontratista). The proveedor factura sin IVA; the cliente cuenta para the IVA to AEAT.
Supplier invoices:
Neto: €1,000 + IVA: €200 = €1,200
Supplier pays €200 to AEAT
Customer reclaims €200
Supplier invoices:
Neto: €1,000 (no IVA shown)
Customer cuenta para €200 IVA
Customer pays AEAT directly
End result: Same amount of IVA is paid to AEAT, but the person responsible changes.
The reverse charge applies to construction services as defined in the IVA Notice 706/14. These are services provided in the course of construction business.
If the cliente is not a contratista or subcontratista (e.g., a homeowner commissioning work on their property), reverse charge does NOT apply. Normal IVA applies instead.
Servicios provided through intermediaries (labour-only agencies) may not qualify. Verificar if the intermediary is acting as principal or agent.
Materials or goods supplied without labour do NOT qualify. Inverso charge only applies when labour or services are provided.
Servicios outside construction scope (accountancy, legal advice, marketing) do NOT qualify, even if provided to construction companies.
¿Cuándo reverse charge applies, your invoice must clearly show that IVA is due from the cliente under reverse charge rules.
Service Descripción
Limpiarly describe the construction service provided
Cantidad Netoa Only
Invoice shows net amount - IVA is NOT shown on the invoice
Inversión del Sujeto Pasivo Statement
Include a statement such:
"Inverso charge – IVA will be accounted for by the cliente under the domestic reverse charge procedure"
Tu Details
Tu IVA number (if registered) and company name
Customer's Details
Customer name, address, and IVA number (if registered)
Invoice Date and Number
General invoice requirements apply
Importarant: The invoice shows €0 IVA. The cliente must still be told the IVA rate (21%) applies, so they know how much IVA to account for.
As the cliente (contratista), you must account for IVA in specific boxes on your IVA return.
¿Cuándo you receive an invoice under reverse charge, you must calcula el IVA due (at 21%) and account for it on your IVA return in both Box 1 (output IVA) and Box 4 (input IVA reclaim).
Include the IVA amount calculated on the reverse charge invoice (invoice amount × 21% ÷ 120%).
Ejemplo:
Invoice: €1,000 net
IVA: €200 (21%)
Box 1: Sumar €200
Claim the same IVA amount as input tax (cost relief for your business).
Ejemplo:
IVA from reverse charge: €200
Box 4: Claim €200
Neto Effect: Box 1 and Box 4 both increase by the same amount, netting to cero impact on your IVA responsabilidad. The process ensures AEAT collects IVA even though the proveedor didn't charge it.
Scenario: You hire a builder for site management. Invoice received: €2,400 (no IVA shown, marked as reverse charge).
Calculation
Invoice amount: €2,400
IVA rate: 21%
IVA due: €400
IVA Declaración
Box 1 (Output): +€400
Box 4 (Input): +€400
Neto: €0
Scenario: Sub-contratista provides three invoices: €5,000 reverse charge, €1,200 normal IVA (to homeowner), €800 normal IVA (plant hire).
Invoice 1
Cantidad: €5,000
Type: Inverso charge
IVA: €833
Invoice 2
Cantidad: €1,200
Type: Normal IVA
IVA: €240
Invoice 3
Cantidad: €800
Type: Normal IVA
IVA: €160
IVA Declaración: Box 1 (Output): €833 | Box 4 (Input): €833 + €240 + €160 = €1,233 | Neto: -€400 (claim)
Scenario: You have an invoice marked "reverse charge" but only the gross amount (€3,000). You need to calcula el porción de IVA.
Using Our Calculadora:
Enter: €3,000 (gross amount)
Select: 21% IVA rate
Result:
Neto: €2,500
IVA: €500
Action: Enter €500 in both Box 1 and Box 4 of your IVA return.
No. Inverso charge is mandatory if the conditions are met. Both the proveedor and cliente must follow the rules. Non-compliance can result in penalties and interest.
Request a credit note and corrected invoice. Do not pay the IVA shown. Keep evidence of the request. Account for the transaction correctly under reverse charge rules.
Only if you are a contratista/principal. A subcontratista can invoice their own subcontratista under reverse charge, but only if they themselves meet the contratista definition.
Verificar AEAT Notice 706/14 for the full list. If the service is labour or design-related to construction, and you're both registered contratistas, it likely qualifies. ¿Cuándo in doubt, ask the proveedor or AEAT.
The España domestic reverse charge only applies to services within the España. EU and international services follow different rules. Consult AEAT or a tax advisor for overseas transactions.
Use our Calculadora IVA Inversa or Inversión Sujeto Pasivo to quickly work out IVA amounts from gross figures.