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V0013-18 6 January 2018 · SG de Impuestos sobre el Consumo Criterion in force
IVA · suplidos

Fees paid on behalf of homeowners' associations may be excluded from the VAT taxable base if they meet disbursements requirements

A query was raised regarding whether elevator maintenance fees paid by maintenance companies on behalf of homeowners' associations can be treated as disbursements. The DGT ruled that this is possible provided the legal requirements of mandate, substantiation, and non-deduction of the tax are strictly met.

The question raised

Consideration as a disbursement not subject to Value Added Tax.

The DGT's ruling

For an expense to be considered a disbursement and not be included in the VAT taxable base, four conditions must be met: that it is paid on behalf of and for the account of the client (evidenced by an invoice issued in the client's name), that there is an express mandate from the client, that the exact amount of the expense is justified, and that the intermediary does not deduct the tax that has levied said expense.

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