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V1276-14 13 May 2014 · SG de Impuestos sobre el Consumo Criterion in force
IVA · inversión del sujeto pasivo

Inversion of the liability party does not apply to bathroom renovations unless part of building rehabilitation

A non-profit entity asks whether bathroom renovations in a nursing home are subject to the inversion of the liability party for VAT. The DGT responds that this mechanism does not apply unless the works are carried out as part of a building rehabilitation process.

The question raised

Question raised: Treatment of said operations for Value Added Tax purposes; reverse charge mechanism.

The DGT's ruling

The reverse charge mechanism for the taxpayer requires that the operations have as their object the urbanisation of land or the construction or rehabilitation of buildings. Bathroom renovation works are not classified as rehabilitation in themselves. The reverse charge mechanism shall only apply if the operations are carried out within a rehabilitation process of a building and all other legal requirements are met.

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