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V1823-20 8 June 2020 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del capital inmobiliario

Tourist rentals without hospitality services or employees classified as investment income

A query was raised regarding whether renting a rural house for tourism purposes should be taxed as an economic activity or as investment income. The DGT ruled that if no hospitality services are provided and no full-time employees are hired, the income is classified as income from real estate capital.

The question raised

Taxation under Personal Income Tax (IRPF) of income derived from the tourist rental of a rural house when services inherent to the hotel industry are not provided.

The DGT's ruling

The leasing of real estate constitutes an economic activity only if at least one employee is utilized under a full-time employment contract. If tourist rentals are supplemented with hotel industry services (restaurant, cleaning, etc.), they are considered income from economic activities. If such services are not provided and the employment requirement is not met, they are considered income from real estate capital.

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