Form 420 — IGIC

Form 420 is the quarterly self-assessment of IGIC (Canary Islands General Indirect Tax). It applies to companies and freelancers with tax domicile in the Canary Islands.

If your business is in the Peninsula or Balearic Islands, refer to Form 303 (VAT).

IGIC Types

The Canary Islands have their own indirect tax system instead of VAT:

Type	Percentage	Application
Zero rate	0%	Exempt activities
Reduced	3%	Basic services, food
General	7%	Most goods and services

Frihet automatically normalizes the tax rates on your invoices to these IGIC types for the calculation of Form 420.

What Frihet Calculates

Accrued IGIC (passed on)

Calculated from your issued invoices for the quarter:

Boxes	Concept	Calculation
01-02	Zero rate (0%)	Base + tax amount
03-04	Reduced (3%)	Base + tax amount
05-06	General (7%)	Base + tax amount
11	Total IGIC passed on	Sum of tax amounts
13	Reverse Charge Mechanism (ISP)	Acquisitions with Reverse Charge
15	Total accrued	Passed on + ISP

Deductible IGIC (borne)

Calculated from your recorded expenses with IGIC:

Boxes	Concept	Calculation
16	Domestic acquisitions	IGIC borne on expenses
17	Imports	IGIC from imports (if applicable)
22	Total deductible	Sum of deductible concepts

Result

Box	Concept	Calculation
23	Difference	Accrued - Deductible
24	To offset from previous periods	Negative amount from prior quarters
26	Result	Difference - Offset

If the result is positive, it is the amount you must pay to the Government of the Canary Islands. If it is negative, it is offset in the following quarter.

How to use it in Frihet

1. Go to Tax Calendar
2. Select the quarter and year
3. Frihet displays the breakdown of Form 420 by IGIC type
4. If you have an amount to offset from previous quarters, enter it
5. Download the PDF as a reference

Differences with Form 303

Aspect	Form 303 (VAT)	Form 420 (IGIC)
Territory	Peninsula and Balearic Islands	Canary Islands
Main rates	21%, 10%, 4%	7%, 3%, 0%
Surcharge regime	Yes (5.2% / 1.4% / 0.5%)	Not applicable
Submission	AEAT (Tax Agency)	Government of the Canary Islands (ATC)
Investment goods	Separate boxes (30-31)	Regularization in box 19

Practical Example

A freelancer in Las Palmas with the following quarter:

Invoices issued:

• 5 service invoices at 7%: 4,000 EUR base
• 2 product invoices at 3%: 1,200 EUR base

Expenses with IGIC:

• Office supplies: 300 EUR + 21 EUR IGIC
• Software: 150 EUR + 10.50 EUR IGIC

Calculation:

IGIC Devengado:
  7%: 4.000 x 7% = 280 EUR
  3%: 1.200 x 3% = 36 EUR
  Total devengado: 316 EUR

IGIC Deducible:
  Interiores: 21 + 10,50 = 31,50 EUR

Resultado: 316 - 31,50 = 284,50 EUR (a ingresar)

Form 130 in the Canary Islands

Although IGIC replaces VAT, Form 130 (IRPF) is also submitted. If you are a freelancer in the Canary Islands, you must submit both forms quarterly:

• Form 420 — IGIC (indirect tax)
• Form 130 — IRPF (income tax installment payment)

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