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V0079-16 13 January 2016 · SG de Impuestos sobre el Consumo Criterion in force
IVA · sujeto pasivo

Business owners may deduct VAT on common expenses of a homeowners' association under specific conditions

A homeowners' association within an industrial estate has enquired whether its business owners can deduct VAT on common expenses. The DGT has ruled that, even if the association itself is not a taxable person, co-owners may deduct the tax provided the invoice breaks down their specific share or through an exceptional alternative based on European case law.

The question raised

Possibility for co-owners who are simultaneously taxable persons and taxable persons for VAT purposes to deduct the amounts of input tax corresponding to services provided to the consulting entity.

The DGT's ruling

If the community is not a taxable person, the co-owners who are taxable persons may deduct VAT if the invoice breaks down their portion of the taxable base and the tax amount. Alternatively, pursuant to CJEU case law, they may deduct it using an invoice issued in the name of the community even if there is no breakdown, by proving their share through other documents. If the community is a taxable person, it must issue individual invoices charging VAT to each co-owner so that they may deduct it.

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