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A homeowners' association enquired whether it was required to pay the VAT rate difference (from 18% to 21%) following the signing of promissory notes for the installation of lifts. The DGT ruled that the signing of promissory notes does not constitute an advance payment; instead, the tax accrual occurs when the promissory notes mature or when the lift is made available.
This ruling clarifies the distinction between the signing of payment instruments and actual advance payments, providing legal certainty regarding the timing of VAT accrual for property improvements.
The tax team reviews your specific situation.
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