Can an invoice in Spain be issued in English?
Yes, you can make an invoice in English in Spain. In fact, if you work with foreign companies, it is advisable to issue invoices in English.
Let’s say you are a trader and you have made a series of transactions with foreign suppliers and they send you an intra-community vat invoice. Now, you need to present these invoices as evidence in a legal case. But, surprise! The invoices are written in a language you don’t understand and the currency used is different from yours. What to do in this situation?
This is the purpose of invoices: to provide a detailed record of business transactions. However, when invoices are written in a foreign language and the currency used is different, it complicates their interpretation and validity as evidence.
Your company has foreign customers and suppliers, and it is common for you to issue or receive invoices in other languages or in currencies other than the euro.
What do you need to take into account in these cases?
Issue invoices in a language other than Spanish.
Official languages in Spain
Your company can issue invoices in any of the official languages spoken in Spain (Spanish, Catalan, Galician or Basque). Invoices received in any of these languages will serve as proof of expenditure for Corporate Income Tax purposes, and will allow you to deduct the VAT incurred.
Non-official languages in Spain
If you have foreign customers or suppliers, there is no problem in issuing or receiving invoices in other languages.
But if your company is subject to a check, you should be aware that the Tax Authorities in Spain may require you to translate these invoices. To this effect:
- For invoices received, they may require a translation in all cases.
- For invoices issued, only in transactions that are understood to have been carried out in Spain. In other words, in sales on which Spanish VAT is charged, as well as in exports and intra-Community deliveries (remember that although these transactions are exempt from VAT, they are also understood to have been carried out in Spain).
- The tax authorities cannot require you to translate invoices for services that are deemed to have been provided abroad, on which you do not have to charge VAT (for example, if your company provides a consultancy service to a French entity).
Issue invoice in English in Spain
To avoid being forced to translate all your invoices in a hypothetical inspection, when invoicing your foreign customers, try to use English, or the language of your customer, but include a translation in English or Spanish next to each item (in italics, for example), and ask your suppliers to do the same.
English is a language that many tax officials know, and they usually do not ask for a translation. We recommend that you issue an invoice in English.
Issue invoice in another currency
The VAT rate must be in Euros.
The amounts that appear on invoices can be expressed in any currency, with the exception of the VAT rate, which must always be expressed in euros.
Normally this will not be a problem, since if your company issues or receives invoices in a foreign language, most of them will not include VAT.
Itemising the VAT on an invoice
However, there may be cases where you do need to itemise VAT on invoices. In these cases, you should make sure that the amount of VAT is shown in euros. For example:
If your company provides a service to a foreign entity that is deemed to be carried out in Spain. This would be the case if you rent premises in Spain to an American company and agree the price in dollars.
If you receive services or purchase products from the Spanish subsidiary of a foreign multinational that operates in a currency other than the euro. In order to be able to deduct VAT, you must require that the tax liability be shown in euros.
Exchange rate of the invoice
In these cases, in order to convert the VAT liability into euros, you must use the selling exchange rate in force on the date on which the transaction is due, as published by the European Central Bank (ECB).
