A LEADING asesor has warned that British-run charity shops are ignoring Spanish laws that require them to charge value added tax (IVA) on second-hand goods.
The advisor, not named to protect client confidentiality, said his client and ‘well-known’ British-run charity shop on the Costa Blanca is facing fines ‘up to €24,000’ after an inspection revealed they charged no IVA on sales throughout 2018.
He warned that, in the eyes of the law, charity shops are being viewed as any other high-street business following recent law changes to crackdown on fraudulent operations.
“It’s not fair that a legitimate business is charging IVA on its clothing sales while next door a charity shop can slash its prices,” the asesor told the Olive Press this week.
“A lot of British expats open charity shops thinking they don’t need to charge IVA on their sales.
“People should be aware, however, this is not a tax clampdown but a collaboration in collecting funds for the government to do its job properly.”
The asesor said he was fighting Hacienda over the fines as his client ‘was not aware’ of the laws – in the UK, charity shops enjoy zero-rated VAT on sales of donated goods.
It comes as another British-run charity shop on the Costa Blanca has been hit with a €5,000 fine after an inspection revealed they paid no IVA on second-hand items sold through their two charity shops in 2017.
“It’s completely unfair,” the president, who asked to remain nameless to protect the charity’s humanitarian work, told the Olive Press.
“Our charity steps in because the government is failing to care for its citizens, and now we have to pay them for it?
“Factoring 21 percent IVA into existing prices will heavily affect the work we do and mean we reach fewer people in need.”
The president added his two charity shops were some ‘of the very few’ British-run enterprises now collecting the tax for the Spanish government.
He urged all charity shops to check with their asesor, gestor and accounting team to make double sure they are not liable to fines.
Susan Weeding, who operates four charity shops for her Easy Horse Care Rescue Centre in Rojales, said she ‘might as well give up’ if she starts paying IVA to the government.
“The September floods left the Vega Baja region with no forage crops left, and we’re now in debt just to keep our 121 horses, ponies and donkeys alive,” Susan, who is also an Olive Press columnist, said.
“You have to bear in mind that most of our rescues have come from the police and councils directly – sometimes from as far as Murcia and Granada.
“We’re not allowed to rehome them as they become evidence in court cases, so why should we have to pay the government for doing our best to help them?”