Skip to content
Back to index
V1315-23 18 May 2023 · SG de Impuestos sobre el Consumo Criterion in force
IVA · ejecución de obra

10% VAT rate applies to tourist apartment construction if habitability certificate or first occupancy licence is held

An individual has requested clarification on the VAT rate applicable to the construction of a property for tourist use under the self-builder regime. The Directorate-General for Taxes (DGT) has ruled that the reduced rate of 10% applies if the property is suitable for residential use, meaning it possesses either a habitability certificate or a first occupancy licence.

The question raised

Type of Value Added Tax applicable to the execution of the works.

The DGT's ruling

The reduced rate of 10% applies to construction works between a developer and a contractor primarily intended for housing. A building is considered suitable for housing if it possesses a certificate of habitability or a first occupancy license and is objectively capable of being used as such. If the tourist apartment meets this suitability requirement, the 10% rate applies; otherwise, the general rate of 21% applies.

Book your free first meeting