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V0993-14 7 April 2014 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IVA · exención

Non-profit sports entities may apply VAT exemption on sports services if they meet social entity requirements

A non-profit sports club seeks clarification regarding the Corporate Tax and VAT treatment of organising a cycling competition. The DGT determines that income from economic activities is subject to Corporate Tax and analyses the VAT exemption for sports services and the reduced rate for shows.

The question raised

In relation to Corporate Income Tax:

The DGT's ruling

Regarding VAT, services provided to natural persons practicing sports are exempt if provided by a social entity and are directly related to said practice. The sale of clothing and merchandising is taxed at the general rate of 21%. The collection of entrance fees for amateur sporting events is taxed at the reduced rate of 10%. In Corporate Income Tax, income from economic activities such as the organization of competitions forms part of the taxable base.

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