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V2178-17 22 August 2017 · SG de Impuestos sobre el Consumo Criterion in force
IVA · indemnización por clientela

Goodwill compensation and unpaid commissions are subject to VAT, but damages are not

A query was raised regarding the VAT treatment of an amount received via a settlement agreement by a commercial agent. The DGT determines that compensation for goodwill and commissions are considerations subject to VAT, whereas compensation for damages is not.

The question raised

The ones detailed in the facts.

The DGT's ruling

Compensation for goodwill constitutes consideration for services rendered and must include VAT. Unpaid or reimbursed commissions are also consideration for services subject to tax. Compensation for damages is not consideration for any taxable transaction and therefore does not carry VAT. There is an obligation to issue an invoice for the concepts subject to tax.

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