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V0071-22 18 January 2022 · SG de Impuestos sobre el Consumo Criterion in force
IVA · renuncia a la exención

Possibility of renouncing VAT exemption in property transfer

A landlord enquires whether they can renounce VAT exemption when selling a property to a company that will use it as a vacation home. The DGT confirms that renunciation is possible if legal requirements are met and the buyer is entitled to the deduction.

The question raised

Possibility of waiving the exemption provided for in Article 20.One.22º of the Value Added Tax Act and the application of the reverse charge mechanism.

The DGT's ruling

The transfer of a building may be exempt from VAT, but the taxable person may waive such exemption if the acquirer is a taxable person with the right to full or partial deduction. To this end, the waiver must be reliably communicated to the acquirer prior to or simultaneously with the delivery. If the waiver is exercised, the reverse charge mechanism applies, with the acquirer being responsible for the tax.

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