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V0085-16 13 January 2016 · SG de Impuestos sobre el Consumo Criterion in force
IVA · cesión de personal

Compensation for the secondment of personnel is subject to VAT as consideration for a service

An entity has enquired whether the compensation received for seconding personnel to collaborate with the consumer arbitration system is subject to VAT. The Directorate General for Taxes (DGT) has ruled that such payment does not constitute indemnity, but rather the consideration for a service.

The question raised

Treatment of the payment of the compensation received by the taxpayer.

The DGT's ruling

The compensation received for the secondment of personnel does not constitute damages, but rather corresponds to the consideration for the personnel secondment service. Therefore, it is considered a supply of services subject to Value Added Tax. The entity must charge the general rate of 21 percent on the invoice.

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