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V0682-17 15 March 2017 · SG de Impuestos sobre el Consumo Criterion in force
IVA · expropiación forzosa

Expropriation of rural or non-buildable land is subject to but exempt from VAT

A company has requested clarification regarding the taxation of land subject to expropriation by a local council. The DGT indicates that transfers via expropriation are subject to VAT, but will be exempt if the land is rural, non-buildable, or intended for public roads.

The question raised

Question raised: Taxation of the operation under Value Added Tax.

The DGT's ruling

The transfer of land through compulsory expropriation is a supply of goods subject to VAT. However, the transaction shall be exempt if it concerns rural land, non-buildable land, or land intended exclusively for parks, gardens, or public road surfaces. The tax liability arises upon the occupation of the property or upon the advance payment of the fair price. Default interest of a compensatory nature does not form part of the taxable base.

Apply this to a real case

What is published here, applied to a company or a specific case. The first meeting is free.

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