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V0866-16 9 March 2016 · SG de Impuestos sobre el Consumo Criterion in force
IVA · exención

Services with fees separate from statutory dues are subject to VAT

A professional legal defence association enquired whether its services, for which fees are charged independently of the monthly membership fee, were exempt from VAT. The DGT ruled that only services covered by the fees established in the association's statutes are exempt.

The question raised

Whether the provision of defense services with fees distinct from the monthly fee would be subject to or exempt from Tax.

The DGT's ruling

The exemption under Article 20.One.12 of the VAT Act applies to services provided to members by non-profit entities when no consideration is received other than the contributions established in their bylaws. Therefore, fees paid by members to satisfy a particular or individual interest are not considered statutory contributions. Consequently, the provision of services invoiced at a price independent of the annual fee are subject to VAT at the general rate of 21 percent.

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