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V2246-20 1 July 2020 · SG de Impuestos sobre el Consumo Criterion in force
IVA · tipo del cero por ciento

Zero-rated medical supply deliveries do not limit the right to deduct input VAT

A medical supply company has requested a ruling regarding the deductibility of VAT on the acquisition of COVID-19 products and the treatment of their zero-rated sales. The DGT ruled that these transactions are taxable rather than exempt, thereby allowing for the full deduction of input VAT.

The question raised

1.- Deduction of Value Added Tax amounts incurred in the acquisition of products covered by the Annex of Royal Decree-Law 15/2020, of 21 April, carried out before 23 April 2020 and subsequently transmitted after said date at 0 percent.

The DGT's ruling

The supplies of goods at the 0% rate provided for in Royal Decree-Law 15/2020 are transactions subject to tax and not exempt, and therefore do not limit the right to deduct input VAT. These transactions do not affect the calculation of the annual pro rata. Invoices must be formally documented as exempt transactions to avoid administrative burdens, but they maintain their nature as taxable transactions.

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