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V0141-21 1 February 2021 · SG de Impuestos sobre el Consumo Criterion in force
IVA · tipo impositivo reducido

Residential photovoltaic installations may qualify for 10% VAT if renovation and material limits are met

A solar panel installation company has requested clarification on the VAT rate applicable to private customers. The DGT has clarified that, provided the works are not part of a comprehensive building renovation, the reduced 10% rate may be applied as renovation and repair works, subject to specific material limits and property conditions.

The question raised

Type of Value Added Tax levy applicable to the execution of works for the installation of solar panels for the final consumer.

The DGT's ruling

Photovoltaic installations in completed dwellings may be taxed at 10% as renovation and repair works if the recipient is an individual or a community of property owners, the dwelling was completed more than two years ago, and the cost of the materials provided does not exceed 40% of the taxable base. If the contribution of materials exceeds said limit, the general rate of 21% shall apply to the entirety of the operation. It is not permitted to apply the reduced rate to only a portion of the execution of the works.

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