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V0827-18 26 March 2018 · SG de Impuestos sobre el Consumo Criterion in force
IVA · tipo impositivo reducido

10% VAT rate for mobility equipment installation depends on material costs not exceeding 40% of the taxable base

An elevator trade association queried whether the 10% reduced VAT rate for mobility equipment installation works should include the cost of auxiliary works and third-party materials. The DGT ruled that supplied materials include tangible goods incorporated into the building and subcontracted activities, but exclude professional services such as architects.

The question raised

Whether auxiliary works (architect's fees, bricklayer's fees, and invoices from intermediaries in the purchase of materials) must be included in the determination of the cost of the materials supplied.

The DGT's ruling

For renovation and repair works on dwellings, the 10% rate is applicable if the cost of the materials supplied does not exceed 40% of the taxable base. This calculation includes incorporated tangible assets and activities subcontracted to third parties, but excludes professional services from the sector (architects, quantity surveyors, etc.). If this limit is exceeded, the operation is classified as a supply of goods and is taxed at the general rate of 21%.

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