As of 2021 the new SII version 1.1. comes into force and constitutes the biggest change in SII reporting since its introduction in July 2017.
What is the SII?
SII stands for Suministro Inmediato de Información del IVA (Immediate Supply of Information on VAT) and is a detailed, Spanish, transactional VAT reporting obligation. SII was first nearly a real-time requirement in the European Union.
Formally, taxpayers have to submit to Spanish tax authorities (AEAT) XML files containing data about their issued and received invoices within four days of the issue date for outgoing invoices, and within four of the date of receipt for incoming invoices. Considering that big multinational businesses issue and receive invoices every single day, they have to report SII files on a daily basis. That is why SII is commonly recognized as a real-time reporting requirement.
When it comes to the scope of reporting, SII is divided into so-called books in which different types of transactions have to be reported. The two main books are: outgoing invoices (Libro de Facturas Expedidas) and incoming invoices (Libro de Facturas Recibidas). As SII relies on transactional reporting, taxpayers have to provide details about their invoices including their invoice number, invoice date, net and VAT amounts, and various codes (mappings) describing particular invoices, such as the F1 (standard invoice), F2 (simplified invoice), any reasons for invoicing without VAT (S1, S2, S3), and so on.
Overview of SII 1.1. version changes
Version 1.1. of SII is valid from January 2021 contains three different groups of changes in SII Spain.
First of all, companies performing stock movements in a simplified call-off stock procedure will have to separately report data about such transactions. This change reflects implementation of Quick Fixes, a package of changes focused on harmonizing and unifying VAT treatment of specific types of transactions in goods at EU level. One of the Quick Fixes sets the standardized approach for call-off stock movements.
Pieces of information about call-off stock movements to be provided in the SII are very detailed. In particular, it is required to provide the specific code of call-off stock operations. There are 12 different codes. For example, 1 covers Expedición, and 6 covers Destrucción, perdida, robo .
Another SII 1.1. change is related to the introduction of some new fields in which additional data have to be provided. Most important are the ones related to the situation in which a taxpayer decides to deduct input VAT in a later period. Then, three new fields have to be filled: DEDUCIR EN PERIODO POSTERIOR, EJERCICIO DEDUCCIÓN and PERIODO DEDUCCION.
The third group of changes is about strengthening the validation of SII data provided to Spanish tax authorities. AEAT has decided to implement many new validations, mainly focussing on logic issues or on the data format of a particular field.
For example, counter-party VAT ID numbers will be validated against its country-specific structure in the case of intra-community invoices. As a different example, if a taxpayer issues an invoice related to the rental of immovable property (special regime codes: 11, 12, 13), the only acceptable VAT rate will be 21%.
Impact of the new SII version 1.1. on VAT reporting
Each taxpayer covered by the SII obligation needs to adopt its IT systems to the new SII 1.1. version. As of 2021 SII files submitted to AEAT have to be in line with technical documentation provided by the AEAT website (in particular XSD structures).
However, the biggest impact of the new SII is on businesses performing transactions in a simplified call-off stock procedure. Their scope of reporting significantly increases.
What is also worth implementing are SII files and data validations in line with the ones described by the Spanish tax authorities before actual SII reporting starts. That would allow businesses to avoid mistakes and reject the files by AEAT.