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V0213-20 31 January 2020 · SG de Impuestos sobre el Consumo Criterion in force
IVA · entrega de bienes

Assembly of client products using own materials may constitute delivery of goods

A French company asks whether assembling client products using its own materials (boxes, toiletries) constitutes delivery of goods or a service provision. The DGT states that it could be considered delivery of goods depending on the relevance of the materials and the customer's perception.

The question raised

1) Whether the operations carried out by the applicant for their client should be classified, for Value Added Tax purposes, as a single supply of goods and whether, in this case, the reverse charge rule would apply to intra-community supplies made within the territory of application of the Tax.

The DGT's ruling

If the client understands that they are purchasing a good and a service, these are two separate transactions; if the service is a means to enjoy the good, it is a supply of goods with an ancillary service. Based on the facts, as significant materials are provided, the transaction appears to be a supply of goods. Regarding advance payments, VAT is not accrued if, at the time of collection, all relevant elements of the accrual are not known nor are the goods precisely identified.

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