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V0305-14 10 February 2014 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IVA · establecimiento permanente

Services related to foreign real estate not subject to Spanish VAT

A Spanish company asked whether services provided from Spain to its permanent establishment in Morocco were subject to Spanish VAT. The DGT replied that services relating to real estate located in Morocco are not considered rendered within the scope of Spanish VAT.

The question raised

It is raised whether the services provided by Spain to its permanent establishment are subject to Value Added Tax.

The DGT's ruling

Services related to real estate are understood to be performed in the territory where the real estate is located. As the services are provided for works in Morocco, the location is situated in that country according to the special rules of Articles 69, 70, and 72 of the VAT Law. Therefore, they are not subject to VAT in the territory of application of the tax in Spain.

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