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V0312-24 ·5 March 2024 ·consulta-vinculante Medium impact
Tax

10% VAT rate for home renovation works subject to material costs not exceeding 40% of the taxable base

A heating and cooling company has requested clarification on the VAT rate applicable to the installation of a heat accumulation system for buildings. The Directorate-General for Taxes (DGT) clarifies that, provided the work does not constitute new construction or major rehabilitation, the reduced 10% rate applies only if the requirements for renovation and repair are met, which includes the condition that material costs must not exceed 40% of the total cost.

In 6 key points

How it affects those involved

This ruling clarifies the strict criteria for applying the reduced VAT rate to renovation works, specifically highlighting the threshold for material costs which may affect the tax planning for building maintenance and renovation projects.

Lifecycle

2024-03-05PublishedPublished in the BOE
Official text Based on BOE data (boe.es). Information, not advice.

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