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V1915-19 22 July 2019 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · renting

Renting payments deductible only with exclusive activity use or 50% presumption

A professional inquired whether full rental payments could be deducted from IRPF and VAT. The DGT states that for IRPF, exclusive use in business activity is required, and for motor vehicles under VAT, a 50% presumption of use applies.

The question raised

Whether the entirety of renting installments may be deducted as an expense in both Personal Income Tax and Value Added Tax.

The DGT's ruling

In Personal Income Tax, renting installments are only deductible if the vehicle is used exclusively for professional activity, without private use. For VAT, if the vehicle is a passenger car, a 50% business use is presumed, unless a different degree is proven or it is a vehicle from the specified list with 100% business use. Business use must be proven by means admitted in Law, and mere accounting entries or tax returns/settlements are insufficient.

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