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V0747-20 7 April 2020 · SG de Impuestos sobre el Consumo Criterion in force
IVA · deducción de cuota

50% IVA deduction possible for tourist vehicles if activity link proven

A food vendor at events asks about IVA deductibility of their vehicle. The DGT states that if activity link is proven, a 50% deduction is presumed for tourist vehicles.

The question raised

Deduction of the Value Added Tax paid on the acquisition of said vehicle.

The DGT's ruling

To deduct VAT on a passenger vehicle, the taxable person must prove its use for business purposes, whereby a degree of business use of 50% may be presumed. Mixed vehicles intended for the transport of goods may have a business use of 100%. Related expenses, such as fuel or repairs, are deductible provided that their consumption is applied to the development of the activity and can be proven. The tax return or accounting entries alone are not sufficient to prove such business use.

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