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V0244-15 21 January 2015 · SG de Impuestos sobre el Consumo Criterion in force
IVA · inversión del sujeto pasivo

Inversion of passive party applies to water and sewer mains in urbanisation processes

A company asked whether carrying out water and sewer mains installation allows the application of the inversion of the passive party. The DGT responds that this mechanism applies if such works are carried out within an urbanisation process of land.

The question raised

Inquiry is made regarding the application of the reverse charge mechanism for the taxable person regulated in Article 84.One.2.f) of Law 37/1992 to the execution of service connection works.

The DGT's ruling

The reverse charge mechanism for the taxable person under Article 84.One.2.f) of Law 37/1992 is applicable if the works for water supply, drainage, or utilities are carried out within a land urbanization process or the construction or rehabilitation of buildings. If these operations are carried out in isolation from such processes, the mechanism shall not apply, unless the works themselves constitute an urbanization or rehabilitation process.

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