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V0160-14 24 January 2014 · SG de Impuestos sobre el Consumo Criterion in force
IVA · derecho a la deducción

VAT on commercial event expenses is deductible if transactions are taxable and not exempt

A multinational company inquired whether it could deduct VAT on expenses incurred when organising commercial events. The DGT ruled that deduction is possible provided the transactions are taxable and not exempt.

The question raised

Deductibility of the tax amounts incurred by the expenses incurred.

The DGT's ruling

The right to deduction may be exercised in the tax return of the period in which the amounts are incurred or in subsequent periods, within the four-year period. For the deduction to proceed, the goods and services must be used in the performance of supplies of goods and services that are taxable and not exempt from the tax. In the specific case, the company may deduct the amounts accrued for taxable operations carried out within the national territory.

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