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V1968-17 20 July 2017 · SG de Impuestos sobre el Consumo Criterion in force
IVA · deducción de cuotas

Business owners in homeowners' associations may deduct VAT under specific conditions

A company enquired whether homeowners' associations must provide duplicate invoices to allow business-owning co-owners to deduct VAT. The DGT explains that while the general rule requires invoices with a breakdown per recipient, an exceptional alternative exists based on European case law.

The question raised

Knowing that co-owners who are taxpayers and entrepreneurs can deduct the amounts of the tax incurred corresponding to services provided to communities of owners, the question is asked regarding the obligation of communities of owners to deliver duplicates of the invoices received to the applicant and regarding the application of the penalty regime of the General Tax Law in case of non-compliance with said obligation.

The DGT's ruling

Entrepreneurs belonging to communities of owners that are not VAT taxpayers may deduct the amounts incurred if they possess a duplicate of the invoice issued in the name of the community, even if it does not detail their proportional share. In this case, the participation is proven with other documents such as the horizontal division deed or statutes. It is also valid to use a copy of the original invoice certified by the community administrator. This exception only applies if the community does not have the status of an entrepreneur or professional.

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