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A community of property has requested clarification on the VAT rate applicable to works carried out to connect members' homes to the general water supply network. The Directorate General for Taxes (DGT) has ruled that these works do not qualify for the reduced rate and must be taxed at the standard rate of 21%.
This ruling clarifies that connection works to the water supply network are subject to the standard VAT rate rather than the reduced rate, affecting the tax liability for developers and property communities.
The tax team reviews your specific situation.
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