Index
General VAT vs REBU: what each scheme is and how they differ
When to apply an invoice with itemised VAT
When to apply REBU
Practical example: the same car with VAT and with REBU
How the choice of scheme affects the buyer
Common mistakes when choosing between VAT and REBU
How to manage both schemes without errors
Conclusion
Frequently Asked Questions
One of the decisions that generates the most doubts in the daily management of a used car dealership is when to issue an invoice with itemised VAT and when to apply the Special Scheme for Second-Hand Goods (REBU). It is not a minor detail: choosing the wrong scheme can mean paying more tax than necessary, issuing incorrect invoices or facing a tax inspection.
The problem is that many dealerships work with both schemes at the same time (because they buy cars from both individuals and companies) and it is not always clear which one corresponds to each transaction. The usual consequence: REBU is applied by default "because that's how it's always done", when in some cases it would correspond to invoice with general VAT, or vice versa.
This article explains in a practical way when to use each scheme, with numerical examples showing the real impact on the final price and profitability, and the most common mistakes to avoid.
General VAT vs REBU: what each scheme is and how they differ
Invoice with itemised VAT (general scheme)
In the general scheme, the dealership charges 21% VAT on the total sale price and itemises it on the invoice. The buyer, if they are a professional (company or self-employed), can deduct that VAT.
This scheme applies when the dealership has purchased the car from a supplier who has issued an invoice with itemised VAT: renting companies, fleets, other dealerships in the general scheme or intra-Community suppliers. In these transactions, the dealership has deducted the input VAT on the purchase, so they must charge it when selling.
REBU (Special Scheme for Second-Hand Goods)
The REBU allows the dealership to pay tax only on the profit margin of the transaction, not on the total sale price. The VAT is not itemised on the invoice and the buyer cannot deduct it.
It applies when the car has been purchased from a private individual or a professional who has not itemised VAT on their invoice (for example, another dealership that sold under REBU). The REBU is regulated in article 135 of Law 37/1992 on VAT and is voluntary, although practically all used car dealerships use it in transactions that allow it.
The fundamental difference is clear: with general VAT you pay tax on the total price. With REBU you pay tax only on what you earn. For transactions with individuals, the REBU is almost always more favourable. If you want to delve into the details of the scheme, we explain it in our complete guide on REBU in the buying and selling of second-hand cars.
When to apply an invoice with itemised VAT
The general scheme with itemised VAT applies when any of these conditions are met:
The car was bought from a company that issued an invoice with VAT. If you bought the vehicle from a leasing company (LeasePlan, ALD, Arval), a corporate fleet or another dealership that charged you 21% VAT, you have deducted that VAT on the purchase. When reselling, you have to apply VAT to the total sale price.
The buyer is a company or self-employed person who needs to deduct the VAT. If your client is a professional who is going to use the car for their business activity, they are interested in receiving an invoice with itemised VAT so they can deduct it. In these cases, even if you could apply REBU, it may make more commercial sense to invoice with general VAT.
Intra-Community transactions. If you buy cars in another EU country from a professional supplier with a VAT number, the reverse charge mechanism applies. When reselling in Spain, you must invoice with general VAT.
When to apply REBU
The REBU applies when the dealership buys the car from an entity that has not itemised VAT on the invoice or on the purchase document:
Purchases from private individuals. This is the most common case. An individual sells their car to the dealership, signs a purchase agreement and the dealership issues a purchase receipt. There is no deductible VAT on the acquisition, so REBU can be applied when reselling.
Purchases from another dealership that sold under REBU. If the supplier also applied REBU and their invoice does not itemise VAT, you can continue to apply REBU when reselling.
Trade-ins. When a private customer hands in their car as part exchange for another vehicle, that trade-in is documented as a purchase from an individual and allows REBU to be applied to the subsequent resale. To properly understand the tax implications of trade-ins, we recommend consulting our article on what Property Transfer Tax (ITP) is in car sales and when it applies.
The REBU invoice must meet specific requirements: the VAT is not itemised, it must include the legal mention that the transaction is subject to the special scheme for second-hand goods, and the dealership must maintain a separate register book for these transactions.
Practical example: the same car with VAT and with REBU
To see the real difference, let's take a car that the dealership buys for 10,000 euros and sells for 13,000 euros. Gross margin: 3,000 euros.
With REBU:
The VAT is calculated only on the margin. The taxable base is the margin between the sales price and the purchase price. Since the VAT is included within that margin, the calculation is: taxable base = 3,000 / 1.21 = 2,479.34 euros. VAT = 520.66 euros. The customer pays 13,000 euros in total. The dealership pays 520.66 euros of VAT.
With general VAT (21%):
The VAT is applied to the total sale price. Price without VAT: 13,000 euros. VAT: 2,730 euros. The customer pays 15,730 euros. The dealership charges 2,730 euros of VAT (although they deduct the input VAT on the purchase, if there was any).
The difference for the private buyer is 2,730 euros. For a professional who deducts the VAT, the net cost may be similar, but for an individual the impact is huge. That is why the REBU is so relevant in sales to final consumers: it allows offering more competitive prices without sacrificing margin.
How the choice of scheme affects the buyer
The choice of scheme does not only affect the dealership. It has direct consequences for the buyer:
Private buyer. They want REBU to be applied, because the final price is significantly lower. With REBU they cannot deduct the VAT, but they don't care either: an individual does not file VAT returns. What matters to them is what they pay.
Company or self-employed buyer. They want an invoice with itemised VAT, because they can deduct that VAT in their quarterly return. If you issue them a REBU invoice, the price may seem lower, but they won't be able to deduct anything, and the real cost may be higher than with general VAT.
Subsequent resale. If a private buyer acquires a car under REBU and then sells it to another private individual, that second transaction will be subject to Property Transfer Tax (ITP), not VAT. This is a point that should be clarified to the customer to avoid confusion.
A good dealership not only chooses the correct scheme: they explain to the customer why they are being invoiced one way or another. That builds trust and avoids complaints.
Common mistakes when choosing between VAT and REBU
Applying REBU when the car was bought with deductible VAT. If you bought the car from a company that charged you VAT and you deducted it, you cannot apply REBU when selling. It is incompatible. If you do, the Tax Agency can claim the difference from you plus a penalty.
For special cases (4% VAT, negative margin, exports), see REBU: special cases, how to calculate the margin and what expenses reduce it.
Not keeping the purchase document from individuals. To justify that you apply REBU, you need to prove that you bought the car without deductible VAT. If you do not have the purchase agreement signed by the individual, you lose the basis for using the scheme. If you want to see the most common mistakes with REBU in detail, we explain them in our article on common mistakes when applying REBU in dealerships.
Itemising the VAT on a REBU invoice. This is a serious mistake. The REBU invoice must not have itemised VAT. Including it invalides the transaction for tax purposes and can lead the buyer to believe they have the right to deduct VAT that legally does not correspond to them.
Not including the mandatory legal mention. Every REBU invoice must carry a disclaimer such as: "Transaction subject to the Special Scheme for Second-Hand Goods. VAT included in the price, without right of deduction". Omitting it can be a reason for an inspection.
Mixing transactions without control. Many dealerships work with both schemes, which is perfectly legal. The problem is not having clear which one corresponds to each transaction. If you don't classify each purchase from the beginning, you end up with a tax mess that is hard to untangle at the end of the quarter. To issue each type of invoice correctly, we recommend our guide on how to issue invoices correctly in the buying and selling of used vehicles.
How to manage both schemes without errors
The key is to classify each transaction from the moment of purchase, not at the moment of sale. When a car enters stock, the dealership must immediately register:
Who it was bought from (individual, company, another dealership). If there is an invoice with deductible VAT or not. Which scheme corresponds to the resale (REBU or general).
If this step is done well, the rest flows: the sales invoice is issued in the correct format, the VAT is calculated on the appropriate base and the register book is kept up to date.
Doing it manually with spreadsheets is feasible if you handle 10-15 cars a month, but it quickly gets complicated as the volume grows. A management system that automatically classifies each transaction and generates the invoice with the correct legal format (REBU or general VAT) eliminates most errors and saves administrative time.
In Dealcar, for example, each transaction is classified from the purchase. The system generates the invoice with the corresponding legal mention, calculates the VAT on the margin or on the total depending on the scheme, and associates the entire file (purchase, preparation, sale, invoice) to the vehicle. To learn more about the tax implications when you sell to different buyer profiles, consult our article on the tax differences between selling vehicles to companies and to individuals.
Conclusion
Choosing between general VAT and REBU is not a preference: it depends on the origin of the car and the type of transaction. Applying the wrong scheme can mean overpaying, issuing incorrect invoices or facing penalties. The good news is that the rules are clear once they are understood, and with an orderly process from the purchase, the management of both schemes is perfectly manageable.
More than 750 dealerships already use Dealcar to manage their billing without errors.
From the platform you can classify each transaction as REBU or general VAT from the purchase, generate automatic invoices with the correct legal format and maintain clear control of the margin and taxation of each car.
If you want to see how it works, check out dealcar.io/facturacion-electronica-coches or request a demo and we will show it to you for free.
Frequently Asked Questions
Can I choose freely between REBU and general VAT?
Not always. The REBU can only be applied when the car was bought without deductible VAT (from an individual or a professional who did not itemise VAT). If you bought with deductible VAT, you have to sell with general VAT. Within the cases where REBU is possible, the application is voluntary: you can opt out and invoice with general VAT, although this is rarely advisable.
What happens if I apply REBU on a car I bought with deductible VAT?
It is a tax offence. The Tax Agency can claim the uncharged VAT, plus late payment interest and a penalty that can range between 50% and 150% of the unpaid amount. It is one of the most expensive mistakes a dealership can make.
Can the buyer demand one scheme or another?
They cannot demand it, but they can prefer it. A professional buyer will ask you for an invoice with VAT so they can deduct it. If the car allows both schemes (a rare case), you can adapt. But if only REBU applies, the professional buyer must know that they will not be able to deduct the VAT from that transaction.
How do I know which scheme to apply in a trade-in?
If the customer who hands you the car is an individual, that purchase is documented as an acquisition from an individual (without deductible VAT). When reselling that car, you can apply REBU. If the customer is a company that issues you an invoice with VAT, the general scheme applies.
What documentation do I need to justify the REBU to the Tax Agency?
The purchase agreement or receipt signed by the individual seller, with full identification (ID card, vehicle details, price, date). In addition, you must maintain a register book of REBU transactions separate from the general book. Without this documentation, the Tax Agency can consider that you do not have the right to apply the scheme and recalculate the VAT on the total sale.
Index
General VAT vs REBU: what each scheme is and how they differ
When to apply an invoice with itemised VAT
When to apply REBU
Practical example: the same car with VAT and with REBU
How the choice of scheme affects the buyer
Common mistakes when choosing between VAT and REBU
How to manage both schemes without errors
Conclusion
Frequently Asked Questions
One of the decisions that generates the most doubts in the daily management of a used car dealership is when to issue an invoice with itemised VAT and when to apply the Special Scheme for Second-Hand Goods (REBU). It is not a minor detail: choosing the wrong scheme can mean paying more tax than necessary, issuing incorrect invoices or facing a tax inspection.
The problem is that many dealerships work with both schemes at the same time (because they buy cars from both individuals and companies) and it is not always clear which one corresponds to each transaction. The usual consequence: REBU is applied by default "because that's how it's always done", when in some cases it would correspond to invoice with general VAT, or vice versa.
This article explains in a practical way when to use each scheme, with numerical examples showing the real impact on the final price and profitability, and the most common mistakes to avoid.
General VAT vs REBU: what each scheme is and how they differ
Invoice with itemised VAT (general scheme)
In the general scheme, the dealership charges 21% VAT on the total sale price and itemises it on the invoice. The buyer, if they are a professional (company or self-employed), can deduct that VAT.
This scheme applies when the dealership has purchased the car from a supplier who has issued an invoice with itemised VAT: renting companies, fleets, other dealerships in the general scheme or intra-Community suppliers. In these transactions, the dealership has deducted the input VAT on the purchase, so they must charge it when selling.
REBU (Special Scheme for Second-Hand Goods)
The REBU allows the dealership to pay tax only on the profit margin of the transaction, not on the total sale price. The VAT is not itemised on the invoice and the buyer cannot deduct it.
It applies when the car has been purchased from a private individual or a professional who has not itemised VAT on their invoice (for example, another dealership that sold under REBU). The REBU is regulated in article 135 of Law 37/1992 on VAT and is voluntary, although practically all used car dealerships use it in transactions that allow it.
The fundamental difference is clear: with general VAT you pay tax on the total price. With REBU you pay tax only on what you earn. For transactions with individuals, the REBU is almost always more favourable. If you want to delve into the details of the scheme, we explain it in our complete guide on REBU in the buying and selling of second-hand cars.
When to apply an invoice with itemised VAT
The general scheme with itemised VAT applies when any of these conditions are met:
The car was bought from a company that issued an invoice with VAT. If you bought the vehicle from a leasing company (LeasePlan, ALD, Arval), a corporate fleet or another dealership that charged you 21% VAT, you have deducted that VAT on the purchase. When reselling, you have to apply VAT to the total sale price.
The buyer is a company or self-employed person who needs to deduct the VAT. If your client is a professional who is going to use the car for their business activity, they are interested in receiving an invoice with itemised VAT so they can deduct it. In these cases, even if you could apply REBU, it may make more commercial sense to invoice with general VAT.
Intra-Community transactions. If you buy cars in another EU country from a professional supplier with a VAT number, the reverse charge mechanism applies. When reselling in Spain, you must invoice with general VAT.
When to apply REBU
The REBU applies when the dealership buys the car from an entity that has not itemised VAT on the invoice or on the purchase document:
Purchases from private individuals. This is the most common case. An individual sells their car to the dealership, signs a purchase agreement and the dealership issues a purchase receipt. There is no deductible VAT on the acquisition, so REBU can be applied when reselling.
Purchases from another dealership that sold under REBU. If the supplier also applied REBU and their invoice does not itemise VAT, you can continue to apply REBU when reselling.
Trade-ins. When a private customer hands in their car as part exchange for another vehicle, that trade-in is documented as a purchase from an individual and allows REBU to be applied to the subsequent resale. To properly understand the tax implications of trade-ins, we recommend consulting our article on what Property Transfer Tax (ITP) is in car sales and when it applies.
The REBU invoice must meet specific requirements: the VAT is not itemised, it must include the legal mention that the transaction is subject to the special scheme for second-hand goods, and the dealership must maintain a separate register book for these transactions.
Practical example: the same car with VAT and with REBU
To see the real difference, let's take a car that the dealership buys for 10,000 euros and sells for 13,000 euros. Gross margin: 3,000 euros.
With REBU:
The VAT is calculated only on the margin. The taxable base is the margin between the sales price and the purchase price. Since the VAT is included within that margin, the calculation is: taxable base = 3,000 / 1.21 = 2,479.34 euros. VAT = 520.66 euros. The customer pays 13,000 euros in total. The dealership pays 520.66 euros of VAT.
With general VAT (21%):
The VAT is applied to the total sale price. Price without VAT: 13,000 euros. VAT: 2,730 euros. The customer pays 15,730 euros. The dealership charges 2,730 euros of VAT (although they deduct the input VAT on the purchase, if there was any).
The difference for the private buyer is 2,730 euros. For a professional who deducts the VAT, the net cost may be similar, but for an individual the impact is huge. That is why the REBU is so relevant in sales to final consumers: it allows offering more competitive prices without sacrificing margin.
How the choice of scheme affects the buyer
The choice of scheme does not only affect the dealership. It has direct consequences for the buyer:
Private buyer. They want REBU to be applied, because the final price is significantly lower. With REBU they cannot deduct the VAT, but they don't care either: an individual does not file VAT returns. What matters to them is what they pay.
Company or self-employed buyer. They want an invoice with itemised VAT, because they can deduct that VAT in their quarterly return. If you issue them a REBU invoice, the price may seem lower, but they won't be able to deduct anything, and the real cost may be higher than with general VAT.
Subsequent resale. If a private buyer acquires a car under REBU and then sells it to another private individual, that second transaction will be subject to Property Transfer Tax (ITP), not VAT. This is a point that should be clarified to the customer to avoid confusion.
A good dealership not only chooses the correct scheme: they explain to the customer why they are being invoiced one way or another. That builds trust and avoids complaints.
Common mistakes when choosing between VAT and REBU
Applying REBU when the car was bought with deductible VAT. If you bought the car from a company that charged you VAT and you deducted it, you cannot apply REBU when selling. It is incompatible. If you do, the Tax Agency can claim the difference from you plus a penalty.
For special cases (4% VAT, negative margin, exports), see REBU: special cases, how to calculate the margin and what expenses reduce it.
Not keeping the purchase document from individuals. To justify that you apply REBU, you need to prove that you bought the car without deductible VAT. If you do not have the purchase agreement signed by the individual, you lose the basis for using the scheme. If you want to see the most common mistakes with REBU in detail, we explain them in our article on common mistakes when applying REBU in dealerships.
Itemising the VAT on a REBU invoice. This is a serious mistake. The REBU invoice must not have itemised VAT. Including it invalides the transaction for tax purposes and can lead the buyer to believe they have the right to deduct VAT that legally does not correspond to them.
Not including the mandatory legal mention. Every REBU invoice must carry a disclaimer such as: "Transaction subject to the Special Scheme for Second-Hand Goods. VAT included in the price, without right of deduction". Omitting it can be a reason for an inspection.
Mixing transactions without control. Many dealerships work with both schemes, which is perfectly legal. The problem is not having clear which one corresponds to each transaction. If you don't classify each purchase from the beginning, you end up with a tax mess that is hard to untangle at the end of the quarter. To issue each type of invoice correctly, we recommend our guide on how to issue invoices correctly in the buying and selling of used vehicles.
How to manage both schemes without errors
The key is to classify each transaction from the moment of purchase, not at the moment of sale. When a car enters stock, the dealership must immediately register:
Who it was bought from (individual, company, another dealership). If there is an invoice with deductible VAT or not. Which scheme corresponds to the resale (REBU or general).
If this step is done well, the rest flows: the sales invoice is issued in the correct format, the VAT is calculated on the appropriate base and the register book is kept up to date.
Doing it manually with spreadsheets is feasible if you handle 10-15 cars a month, but it quickly gets complicated as the volume grows. A management system that automatically classifies each transaction and generates the invoice with the correct legal format (REBU or general VAT) eliminates most errors and saves administrative time.
In Dealcar, for example, each transaction is classified from the purchase. The system generates the invoice with the corresponding legal mention, calculates the VAT on the margin or on the total depending on the scheme, and associates the entire file (purchase, preparation, sale, invoice) to the vehicle. To learn more about the tax implications when you sell to different buyer profiles, consult our article on the tax differences between selling vehicles to companies and to individuals.
Conclusion
Choosing between general VAT and REBU is not a preference: it depends on the origin of the car and the type of transaction. Applying the wrong scheme can mean overpaying, issuing incorrect invoices or facing penalties. The good news is that the rules are clear once they are understood, and with an orderly process from the purchase, the management of both schemes is perfectly manageable.
More than 750 dealerships already use Dealcar to manage their billing without errors.
From the platform you can classify each transaction as REBU or general VAT from the purchase, generate automatic invoices with the correct legal format and maintain clear control of the margin and taxation of each car.
If you want to see how it works, check out dealcar.io/facturacion-electronica-coches or request a demo and we will show it to you for free.
Frequently Asked Questions
Can I choose freely between REBU and general VAT?
Not always. The REBU can only be applied when the car was bought without deductible VAT (from an individual or a professional who did not itemise VAT). If you bought with deductible VAT, you have to sell with general VAT. Within the cases where REBU is possible, the application is voluntary: you can opt out and invoice with general VAT, although this is rarely advisable.
What happens if I apply REBU on a car I bought with deductible VAT?
It is a tax offence. The Tax Agency can claim the uncharged VAT, plus late payment interest and a penalty that can range between 50% and 150% of the unpaid amount. It is one of the most expensive mistakes a dealership can make.
Can the buyer demand one scheme or another?
They cannot demand it, but they can prefer it. A professional buyer will ask you for an invoice with VAT so they can deduct it. If the car allows both schemes (a rare case), you can adapt. But if only REBU applies, the professional buyer must know that they will not be able to deduct the VAT from that transaction.
How do I know which scheme to apply in a trade-in?
If the customer who hands you the car is an individual, that purchase is documented as an acquisition from an individual (without deductible VAT). When reselling that car, you can apply REBU. If the customer is a company that issues you an invoice with VAT, the general scheme applies.
What documentation do I need to justify the REBU to the Tax Agency?
The purchase agreement or receipt signed by the individual seller, with full identification (ID card, vehicle details, price, date). In addition, you must maintain a register book of REBU transactions separate from the general book. Without this documentation, the Tax Agency can consider that you do not have the right to apply the scheme and recalculate the VAT on the total sale.
