What is IRPF on a Spanish invoice?

IRPF withholding confuses many foreign business owners in Spain. This guide explains it clearly with a real example.

The basics

When you invoice certain Spanish businesses as an autónomo, they deduct a percentage from your payment and pay it to Spain's tax office (AEAT) on your behalf. This is called IRPF withholding.

It's not a penalty or a fee — it's a prepayment of your income tax. The money still counts as yours; it just goes to AEAT first.

A worked example

You invoice a Spanish company €600 for design work, with 21% IVA and 15% IRPF:

• Service fee: €600.00
• + IVA (21%): €126.00
• − IRPF (15%): −€90.00
• Your client pays you: €636.00

Your client pays the €90 IRPF to AEAT directly (via Modelo 111). At the end of the year, this €90 is credited against your income tax bill.

When does it apply?

• You are an autónomo providing professional services
• Your client is a Spanish company or autónomo
• Your services are listed in AEAT's regulated activities

It does NOT apply when invoicing private individuals, foreign clients, or for most product sales.