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V0658-22 25 March 2022 · SG de Impuestos sobre el Consumo Criterion in force
IVA · arrendamiento con opción de compra

Lease with option to purchase is a service provision until a commitment to purchase exists

A City Council has requested clarification regarding VAT taxation on a lease with an option to purchase, including the initial premium and the residual value. The DGT clarifies that the nature of the transaction changes depending on the lessee's commitment.

The question raised

Taxation of the transaction for Value Added Tax purposes, specifically regarding the amount paid at the time of signing, as well as the residual value, in the event that the purchase option is exercised.

The DGT's ruling

The transaction constitutes a provision of services as long as the lessee does not commit to exercising the purchase option, with accrual occurring with each payable installment and based on a taxable amount that includes the financial charge. Once the lessee formalizes the commitment to purchase, the transaction becomes a supply of goods. In this case, accrual occurs upon formalization of the commitment, and the taxable amount comprises the outstanding installments plus the amount of the purchase option, excluding interest for subsequent deferment.

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