Questions and answers on Form 347
In the world of consultancy, form 347 is like the tax bible. See in this article what, when, how and who is obliged to file form 347.
In this article you will know more about this very important tax declaration.
What transactions are declared on Form 347?
Form 347 must be filed when transactions are carried out with a customer or supplier for a total amount of more than 3,005.06 euros (including VAT).
You will not have to file form 347 if you pay IRPF in modules and, at the same time, VAT under the simplified regime, the agriculture, livestock and fishing regime, or the equivalence surcharge.
However, you must file it for transactions for which you have issued an invoice, and for purchases of goods and services if you are under the simplified regime (in any case, transactions carried out with the same customer or supplier must exceed 3,005.06 euros.
If you have carried out transactions for which the Tax Authorities already have information (through other returns), you will not now have to include them in form 347.
Thus, you should not include the following transactions in form 347:
- Transactions subject to withholding tax, because the Inland Revenue already has information on them thanks to the periodic returns and annual summaries.
- Intra-Community deliveries or acquisitions of goods and services, because they are declared on form 349.
- Export and import operations, because they are declared to customs. The same applies to deliveries of goods between the mainland and the Canary Islands, Ceuta and Melilla.
- If you are a professional businessperson and you carry out operations outside your activity (for example, if you have bought a car for your own use), you should not include them in form 347 either.
Some non-VAT transactions ARE declared in the 347 form
Some people think that transactions where no VAT is borne or output VAT is not charged should not be declared on form 347. However, this is not the case. For example:
- You must declare on form 347 transactions in which the taxable person has reversed the tax. However, you must declare the amount excluding VAT.
- You must also report the interest you have paid on a bank loan.
Self-consumption if declared on the 347 form
Although you do not have to declare free transactions in which you do not charge VAT (such as, for example, the free supply of a good for which input VAT could not be deducted), you must include in form 347 the free supplies that are in the nature of external self-consumption, as you do have to charge the tax on them.
Thus, for example, if your company manufactures furniture and furnishes an employee’s home free of charge, you must declare this supply, calculating the value of the cost attributable to the furniture, plus VAT.
When do I file Form 347?
Form 347 is filed every year in February with a deadline on the last day of February. We recommend that you always look at the taxpayer’s calendar in Spain.
Include your transactions in the same quarters in which you are required to include them in the VAT registration books. There are special rules for advances and refunds.
How do I file form 347?
Form 347 can only be filed online on the website of the Spanish tax office at this link.
Form 347 – which is filed in February – must be broken down by quarter. Remember the rules applicable in this matter.
General rule
This February your company will file form 347 (declaration of transactions with third parties), breaking down the information by quarter.
In general, invoices issued are allocated in the quarter in which the transaction took place, while those received are allocated in the quarter in which they are received.
Special rules
However, certain transactions have special imputation rules:
- Advances.Charge advances in the quarter of their collection, and the rest of the price in the quarter of the transaction. If the advance payment is collected in a previous year, you will only have to declare it if its amount, added to the rest of the operations of the year, exceeds 3,005.06 euros. If in that year it does not reach that amount and you do not declare the advance payment, you must declare it when you carry out the operation (if in that year it exceeds the limit indicated).
- Refunds or discounts: you must deduct from the amount of the operations the refunds, discounts and rebates granted, as well as the operations that are not effective. If in a quarter there are only corrections, you must declare the amount of these in negative (if in a year the total amount of the operations with the same customer is negative, you must also declare it if it exceeds 3,005.06 euros in absolute terms).
Example of form 347
In 2024 sales to a customer amount to 10,000 euros, but in January 2025 there is a return of goods amounting to 3,500 euros.
3,005.06, you will have to declare both transactions (one in 2019 and one in 2020). If the refund is for an amount below this limit, you should not declare it.
Which taxpayers do not have to break down by quarter?
In any case, certain taxpayers must compute their transactions in the 347 on an annual basis, without a quarterly breakdown. Specifically, the communities of owners under the horizontal property regime, entrepreneurs who carry out transactions under the cash basis, and the recipients of these transactions (they must also declare them on an annual basis).
Do I have to declare rents in the 347 form?
In general, rents do not have to be declared in the 347 form even if they exceed this amount:
- Housing.Your client should not include income from the rental of housing to private individuals who are his permanent residence in this declaration (such rentals are exempt from VAT and he should not issue an invoice for them). However, if you have rented parking spaces or storage rooms separately from the dwellings, you must declare them (as long as they exceed the amount indicated).
- If you have rented premises (or a home to be used as an office), it will depend on whether the rent has been subject to withholding: if it has been, you will not have to include it in the 347 (as the tenant will already have included these amounts in the annual summary of withholdings).
- But if the rents have not been subject to withholding, you will have to declare them in the 347 (remember that, if the total cadastral value of the rented premises exceeds 601,102.10 euros, your client can inform the tenants not to withhold any withholding on the rents they pay you).
Most rents do not have to be declared on form 347, with some exceptions (such as rents of premises not subject to withholding tax).
Are homeowners' associations obliged to file form 347?
If you are the administrator of a homeowners’ association, remember that associations may also be obliged to file form 347 (“Annual declaration of transactions with third parties”) with the tax authorities.
Well then:
- In this form, you must report the operations carried out by the community with third parties that exceed 3,005.06 euros. In this sense, all transactions, including VAT, carried out during the year with one and the same person (e.g. with the lift maintenance company, with a builder who has carried out repairs to common elements or with the cleaning company) must be added together.
- On the other hand, the amounts paid by the owners (ordinary fees or contributions), the community supplies and the community insurance should not be declared. If the community has rented premises or a dwelling (e.g. the porter’s lodge), the amounts received for this rent should not be reported either.
Do I have to declare an advance payment on form 347?
If you have received an advance payment at the end of 2023, you must declare it in form 347, allocating it to the quarter of the payment (and provided that this advance payment, added to the rest of the operations carried out with this customer, exceeds 3,005.06 euros).
And if the transaction is carried out in 2024, it must be declared in full on form 347 in 2024, subtracting the amount imputed in 2023.
Am I obliged to declare form 347 if I receive a subsidy?
A taxpayer who pays IRPF in objective estimation and has received different subsidies and public aid exceeding 3,005.06 euros, asks the DGT whether the aid received should be declared on the annual declaration form for operations with third parties (form 347).
In its reply, the Administration recalls that natural persons who carry out business or professional activities are obliged to file an annual tax return on their transactions with third parties, this being considered to be the activities defined as such in the VAT law.
Notwithstanding the above, individuals and entities under the income attribution system are excluded from the obligation to submit the annual return for personal income tax, for activities taxed under the objective assessment method for personal income tax and, simultaneously, for VAT under the special simplified or agricultural, livestock and fishing regimes or the equivalence surcharge, except for transactions for which an invoice is issued.
It therefore concludes that, in principle, the taxpayer who engages in the activity of transport by taxi and is taxed under the objective assessment method for personal income tax purposes would not, in general, be obliged to file a declaration of transactions with third parties, except for transactions for which an invoice is issued.
