Index

1. What REBU is and what it is used for

2. When you can apply REBU and when you cannot

3. How to calculate VAT with REBU: transaction-by-transaction method

4. Global REBU: quarterly calculation for high-volume dealerships

5. Formal obligations: invoice, registry book and tax return

6. Which VAT you can deduct with REBU

7. Full numerical example: REBU vs. standard scheme

8. Frequent mistakes when applying REBU and their consequences

9. Frequently asked questions

What REBU is and what it is used for

The Special Scheme for Second-Hand Goods (REBU) is a tax mechanism designed to avoid double VAT taxation on the purchase and sale of goods that have already circulated on the market. It is regulated in Article 135 of Spanish VAT Law 37/1992 and is voluntary for used car dealerships and trading companies.

The logic is simple. When an individual sells their car, they do not charge VAT because they are not a business. If the dealership bought that car and sold it applying the general VAT scheme (21% on the total sale price), it would be paying tax that the market already bore at the time, when the car was brand new. REBU corrects that: it allows the dealership to pay tax solely on the margin obtained in the transaction, not on the total value of the vehicle.

For a business that moves dozens of cars a month, the difference between paying tax on the total price and paying tax only on the margin can mean thousands of pounds annually in VAT to be paid. REBU is not an exceptional tax benefit: it is the logical scheme for an activity in which the value of the goods was already taxed when they left the factory.

When you can apply REBU and when you cannot

Not all used car transactions can qualify for REBU. The fundamental requirement is the origin of the vehicle: how you acquired it.

You can apply REBU when you have bought the car from:

• A private individual (no VAT on the purchase transaction)

• A business or self-employed person who was not entitled to deduct VAT on the vehicle (for example, a business that used it for exempt activities)

• Another dealership that sold to you under REBU (without VAT itemised on its invoice)

You cannot apply REBU when you have bought the car from:

• A leasing company or fleet company that issued you an invoice with itemised VAT

• Another dealership under the general scheme (with itemised VAT)

• An intra-community supplier with deductible VAT

• An auction where the seller invoiced with VAT

The rule of thumb: if there is itemised VAT on the purchase invoice and you have deducted it, you must apply the general scheme on the resale, not REBU. If there is no itemised VAT on the purchase (or the VAT was not deductible), apply REBU.

This means that both schemes can coexist in the same business, depending on how each vehicle was purchased. It is not the scheme of the business, but the scheme of each individual transaction.

To look deeper into when you should issue an invoice with itemised VAT and when you should not, you can consult our guide on when to invoice with VAT and when to apply REBU.

How to calculate VAT with REBU: transaction-by-transaction method

The most common method and the one that best suits dealerships with varied stock is the transaction-by-transaction calculation. VAT is calculated individually for each vehicle at the time of sale.

Base formula:

Gross margin = Sale price (VAT included) − Purchase price
Taxable base = Gross margin ÷ 1.21
VAT to be paid = Taxable base × 0.21

Example:

A dealership buys a Volkswagen Golf from an individual for €9,500 and sells it for €12,000.

The dealership pays €433.88 in VAT to the tax authority for this transaction, not 21% on the €12,000 (which would be €2,479). The difference is more than €2,000 in a single transaction.

Important: if the margin is negative (you sell below the purchase price), the taxable base is zero. No VAT is paid, but no credit is generated to compensate in the next transaction under the individual method either.

Global REBU: quarterly calculation for high-volume dealerships

There is a second calculation method: Global REBU or per period, which allows you to calculate the margin of all REBU transactions for the quarter dynamically as a whole.

Formula:

Global margin = (Total REBU sales for the quarter) − (Total purchases of cars sold under REBU in that quarter)
Taxable base = Global margin ÷ 1.21
VAT to be paid = Taxable base × 0.21

The advantage of Global REBU is that negative margins on some transactions offset positive margins on others. If in a quarter you sell ten cars with an average margin of €1,800 but one with losses of €800, the VAT is calculated on the net margin of the period, not transaction by transaction.

When Global REBU is convenient:

• Dealerships with a high volume of transactions (more than 15-20 cars monthly under REBU)

• Businesses with margin variability where some vehicles are sold at a loss

Important limitation: Global REBU can only be applied to second-hand goods purchased from individuals within the territory of Spain's VAT application. It cannot be combined in the same period with the transaction-by-transaction method for the same categories of goods. Once the global method is chosen for a category, it must be maintained for at least one calendar year.

Formal obligations: invoice, registry book and tax return

Applying REBU correctly implies meeting specific formal requirements. An error here can invalidate the scheme during an audit.

The invoice in REBU operations

The sale invoice under REBU has specific characteristics that set it apart from an invoice under the general scheme:

• VAT is not itemised. The sale price is expressed as a single amount that includes the implicit VAT, but without showing it separately.

• Mandatory mention. The invoice must explicitly state that the operation is subject to REBU. The standard phrase accepted by the tax office (AEAT) is: "Régimen especial de los bienes usados. IVA incluido en el precio. Sin derecho a deducción." (Special scheme for second-hand goods. VAT included in the price. Without right to deduction.)

• The buyer cannot deduct VAT. This is a consequence of the scheme, not an error. If the buyer is a business and wants to deduct VAT, you must sell to them under the general scheme, which implies that the purchase of the vehicle must also have been made with VAT.

Purchase document from an individual

When you buy a car from a private individual, they cannot issue you an invoice (they are not a business). Instead, you must generate a purchase document or self-invoice that proves the transaction. This document must include: seller details, vehicle details (registration number, chassis number), purchase price and date. Both parties sign it.

This document is what proves to the tax authorities that the transaction can qualify for REBU.

The REBU registry book

You are obliged to keep a specific registry book for transactions under REBU, separate from the general VAT registry book. It must record for each transaction:

• Transaction number

• Purchase date and sale date

• Description of the good (make, model, registration, chassis number)

• Purchase price and sale price

• Margin obtained and corresponding VAT amount

Keeping the registry book and supporting documents is compulsory for at least four years (the general tax limitation period). In the event of an inspection, it is the document that proves you have applied the scheme correctly in each transaction.

VAT return (Form 303)

VAT calculated under REBU is settled along with the VAT of other transactions in Form 303 (quarterly or monthly depending on the taxpayer's scheme). The specific boxes for REBU operations are box 11 (taxable base) and box 12 (accrued tax). If you apply the global method, the calculation is consolidated at the end of the period before transferring it to the form.

To understand how these invoices fit into the complete invoicing process of a dealership, we recommend our guide on how to correctly issue invoices in car sales.

Which VAT you can deduct with REBU

One of the most common confusions about REBU is assuming that no VAT can be deducted. That is not correct. What you cannot deduct is the input VAT on the acquisition of the vehicle (although in most purchases from individuals, there is no VAT to deduct). However, you can deduct VAT on:

• Repairs and workshop work carried out on the vehicles

• Spare parts and materials incorporated into the vehicle during preparation

• Management, appraisal or inspection services (MOT/ITV, traffic department reports)

• Rent for the premises or industrial unit where you carry out the business activity

• Office supplies, utilities and other general business expenses

The key is that these expenses are related to the business activity in general, not to the acquisition of the specific good being resold. REBU limits the deduction of the VAT on purchasing the vehicle, not the VAT on the business's operating costs.

Full numerical example: REBU vs. standard scheme

To clarify the financial impact of this scheme, we compare the same transaction under two scenarios.

Transaction: Purchase of a car from an individual for €14,000 and sale to an end customer for €17,500.

In this example, under REBU the dealership pays €607.44 to the tax authorities. Under the general scheme, it would pay €3,675, although it could deduct the input VAT on the purchase if it had made it from a supplier who invoiced with VAT. For a purchase from an individual (with no deductible VAT), REBU represents a direct saving of more than €3,000 in this specific example.

The impact on the buyer is also relevant: if the customer is a private individual, under REBU they cannot deduct any VAT (since they do not see it itemised). If it is a business that wants to deduct VAT, it must buy from a dealership that sells under the general scheme. To see how this distinction affects corporate buyers, you can review our guide on when to invoice with VAT and when to apply REBU.

Frequent mistakes when applying REBU and their consequences

Errors in applying REBU are not just accounting mistakes: they can lead to penalties ranging between 50% and 150% of the unpaid amount, plus late payment interest. These are the ones that appear most frequently in tax inspections:

Applying REBU to transactions that do not meet the requirements. Buying from a leasing company with deductible VAT and selling under REBU is the most serious mistake. The Spanish tax agency considers this VAT fraud. The solution is to always double-check the purchase invoice before choosing the sales scheme.

Calculating the margin on the sales price excluding VAT. Under REBU, the sales price includes VAT, and the taxable base is calculated by dividing the margin by 1.21 (not by multiplying the margin directly by 0.21). Applying 21% directly to the margin means paying more VAT than necessary.

Issuing the invoice with itemised VAT in REBU operations. If you itemise the VAT on a REBU invoice, the document is tax-wise incorrect. In addition, the buyer may try to deduct it, which generates an additional problem in their tax return.

Failing to include the mandatory mention on the invoice. An invoice without the REBU clause is an incomplete invoice according to the regulations. In an audit, the systematic absence of this mention can lead the tax agency to declare that the scheme has not been correctly applied.

Failing to keep the registry book or keeping it incomplete. Without a registry book, you cannot prove that each transaction met the requirements of REBU. The tax agency can recalculate the assessment applying the general scheme, with the cost this implies.

Confusing REBU with ITP (Property Transfer Tax). ITP is paid by the car buyer, not the dealership. It is a completely different tax from REBU, which is a VAT scheme for professional sellers. If you have any doubts about the tax liabilities of each party in the transaction, we recommend our guide on what ITP is in car sales.

For a comprehensive review of the most common mistakes when applying REBU in dealerships and how to correct them, you can consult our specific article on common mistakes with REBU in car dealerships.

More than 750 dealerships already use Dealcar to manage their daily operations

Applying REBU correctly requires each transaction to be documented: purchase price, sale price, car origin, correctly issued invoice, and updated registry book. When you handle twenty or thirty cars a month, doing this manually is a constant source of errors.

Dealcar centralises stock management, invoicing and the registration of each transaction in a single platform. You can generate purchase documents for private individuals, issue invoices under REBU with the mandatory statement included, automatically keep the registry book and have everything ready for any tax lookup.

If you want to see how it works, you can book a free demo at dealcar.io.

Frequently asked questions

Is REBU mandatory or can I choose not to apply it?

REBU is voluntary. You can opt out of it and apply the general VAT scheme even to transactions that would meet the requirements. However, in practice, opting out only makes sense if your buyer is a business that needs to deduct the VAT and it is in your interest to offer them that benefit. In all other cases, REBU is financially more advantageous for the dealership.

Can I apply REBU and the standard scheme in the same quarter?

Yes. The scheme is determined transaction by transaction (or using the global method if you have chosen it). In the same quarter you can have REBU invoices (cars bought from individuals) and general scheme invoices (cars bought from businesses with VAT). Each transaction follows its scheme and both are consolidated in the quarterly Form 303.

What happens if I sell a car at a loss under REBU?

With the transaction-by-transaction method, if the sale price is lower than the purchase price, the margin is negative and the taxable base is zero. You do not pay VAT on that transaction, but you cannot offset that loss in future individual transactions either. With the global method, losses on some operations do reduce the total margin for the quarter and therefore the VAT to be paid.

How long do I have to keep the REBU registry book?

The standard limit is four years (the statute of limitations for tax obligations), but in practice it is recommended to keep it for at least six years to cover potential inspections from previous years. Purchase documents from individuals and sales invoices must be kept for the same period.

Can a private buyer claim a VAT refund in a REBU transaction?

No. In a REBU transaction, a private buyer has no right to claim a VAT refund because the tax is included in the price but is not itemised on the invoice. The scheme does not allow the buyer (whether an individual or business) to deduct the VAT. If a corporate buyer needs to deduct the VAT, the transaction must be carried out under the general scheme, which requires the original purchase of the vehicle to have had deductible VAT too.