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V1791-19 11 July 2019 · SG de Impuestos sobre el Consumo Criterion in force
IVA · base imponible

Property tax passed on by landlord must be included in the VAT taxable amount for rent

A tenant inquired whether the amount of Property Tax (IBI) passed on by the landlord in the rent invoice should be included in the VAT taxable amount. The Directorate General for Taxes (DGT) ruled that it must, as any effective credit from the landlord to the tenant arising from the service constitutes part of the consideration.

The question raised

Inclusion of the aforementioned tax in the taxable base of Value Added Tax.

The DGT's ruling

The VAT taxable base for leases of real estate subject to the tax includes not only the rent, but also amounts assimilated to rent and any other actual credit of the lessor against the lessee. This comprises water, electricity, waste, community fees, works, and the amount of the Real Estate Tax (IBI) passed on to the lessee.

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