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V2032-17 26 July 2017 · SG de Impuestos sobre el Consumo Criterion in force
IVA · renuncia a la exención

Option to waive VAT exemption on building transfers if the purchaser is entitled to tax deductions

A query was raised regarding whether it is possible to waive the VAT exemption on the transfer of an apartment and a parking space. The DGT ruled that while the transfer of buildings constitutes a second exempt supply, a waiver is permitted if the purchaser is a taxable person entitled to VAT deductions.

The question raised

Question posed: Possibility of waiving the exemption in the event that the apartment and the parking space are transferred jointly or if the apartment and the parking space are transferred separately in different deeds.

The DGT's ruling

The transfer of buildings (apartment or garage) constitutes a second supply exempt from VAT. The taxable person may waive this exemption if the acquirer is a businessperson or professional entitled to full or partial deduction of the tax. If the parking space is leased independently of the apartment, it generates a right to deduction, which would allow for the waiver of the exemption in the transfer of both assets through the application of pro rata.

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