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V0023-14 13 January 2014 · SG de Impuestos sobre el Consumo Criterion in force
IVA · arrendamiento de locales

Leasing of commercial premises by a non-profit entity is subject to VAT

A non-profit entity has requested clarification regarding its obligations upon starting a commercial premises rental activity in Vitoria. The DGT has ruled that this activity classifies the entity as a business owner and that, since it operates in the Basque Country, taxation will depend on its turnover and territory.

The question raised

Formal obligations.

The DGT's ruling

The activity of leasing commercial premises constitutes a supply of services subject to VAT when carried out by an entity with the status of a trader. Formal obligations include submitting commencement declarations, applying for a Tax Identification Number (NIF), issuing invoices, maintaining accounting records, and submitting quarterly tax returns. If the entity operates exclusively in the Basque Country, it shall be taxed by the corresponding Provincial Council.

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