VAT on road passenger transport in Spain
Road passenger transport carries the reduced VAT rate of 10%, which Spanish VAT Law 37/1992 applies to the transport of passengers and their luggage. If the trip leaves Spain, Spanish VAT applies to the part of the journey that runs through the territory where the tax applies.
Here is what the law says about the rate, what happens with international trips, when the special travel agency scheme comes in, and how a service becomes an invoice in Bus Center. Bus Center does not decide the VAT on your invoices: you review that with your adviser.
Which VAT rate passenger transport carries
Passenger transport takes the reduced rate. Law 37/1992 on Value Added Tax says in its article 91 that the 10% rate applies to a list of operations, and among the services on that list are the transport of passengers and their luggage.
The standard rate is different: article 90 says that the tax is charged at 21%, except as provided in the following article, which is the one on reduced rates. And the rate applicable to each operation is the one in force when the tax becomes chargeable, so if the law changes, what counts is the date it becomes chargeable, not the date of the quote.
What falls under that rate, and what is less clear
The law refers to the transport of passengers and their luggage. The coach service with driver hired by a school, a company or a wedding couple is passenger transport, and each passenger's suitcase travels with them.
What is less clear is what is sold together with the coach. If other things are in the same price, such as a meal, an admission ticket or a hotel night, you have to see which rate applies to them and whether they form part of the transport or are separate operations. That is a question for your adviser, and worth asking before you quote.
Trips that leave Spain
On an international trip, Spanish VAT applies only to the Spanish part of the route. Article 70 of Law 37/1992 says that passenger transport services, whoever the recipient, are deemed to be supplied in the territory where the tax applies for the part of the journey that runs through that territory.
For a coach going from Madrid to Porto, that means splitting the price between the part of the journey in Spain and the part through Portugal. How the part outside is taxed depends on the other country's rules, and it is a case worth reviewing with your adviser before invoicing.
If you organise the whole trip: the travel agency scheme
When the coach company sells an entire trip, with a hotel and other services bought from third parties, it may fall under a special VAT scheme. Law 37/1992 applies the special travel agency scheme to the operations of agencies that act in their own name towards travellers and use goods or services supplied by other businesses, and also to organisers of tourist circuits and to any business in which those circumstances apply.
For the purposes of this scheme, trips are taken to be accommodation or transport services provided jointly or separately. But the law does not apply it when the trip is made exclusively with the business's own transport or hospitality means. And if own and third-party means are used in part, the special scheme applies only to the services provided with third-party means.
In practical terms: the journey in your own coach does not fall under that scheme; the hotel you buy from someone else and resell in your own name may. If you organise trips like that, also see what the law says about organised trips.
How a service is invoiced in Bus Center
In Bus Center the service becomes an invoice without retyping, with its series and payments. When you invoice a service, the program creates the draft invoice and links it to the service; issuing it is a decision for a person, because an invoice is a tax act with sequential numbering. Before issuing it is the moment to check the VAT rate on each line.
A service is not invoiced twice, a cancelled service is not invoiced, and a service without a price does not become an invoice until it has one. To refund money, a corrective invoice is issued, not a negative invoice.
Invoicing with Bus Center is not compulsory: if you prefer to carry on invoicing as you do now, the rest of the program works the same. What Bus Center does not do is advise you on which VAT applies to each operation. For preparing the price, see the coach quote, and for what each vehicle earns, profitability per coach.
Questions worth taking to your adviser
With the law in front of you, these are doubts worth clearing up in a coach company:
- If a service includes a meal, a guide or admission tickets, which rate applies to each part and how is it shown on the invoice?
- On an international trip, how is the price split between the Spanish part and the foreign part?
- If I organise trips with a hotel bought from others, does the special travel agency scheme affect me?
You can see the rest of the program's features on the Bus Center home page (in Spanish).
Sources consulted
Checked on 11 October 2026. We link to the original source so that you can consult the current text.
Frequently asked questions
Which VAT rate applies to passenger transport?
The reduced rate of 10%: article 91 of Law 37/1992 applies it to the transport of passengers and their luggage. The standard rate is 21%.
What VAT applies to a coach trip that leaves Spain?
Spanish VAT applies to the part of the journey that runs through the territory where the tax applies, under article 70 of Law 37/1992. The foreign part depends on the other country's rules.
Does the travel agency scheme apply to a coach company?
Not to trips made exclusively with its own means of transport. If a trip uses third-party services, such as a hotel bought from someone else and sold in its own name, the special scheme may apply to that part.
Does Bus Center calculate the VAT on my services?
Bus Center turns the service into a draft invoice, with its series and payments, but it does not advise you on VAT: the rate on each line is reviewed before issuing.