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V2248-20 1 July 2020 · SG de Impuestos sobre el Consumo Criterion in force
IVA · suelo urbano no consolidado

Transfer of rural land with unconsolidated urban land status is subject to but exempt from VAT if urbanisation works have not commenced

A query was raised regarding whether the acquisition of rural land classified as unconsolidated urban land through a public auction is exempt from VAT. The DGT indicates that, provided that physical urbanisation works have not begun, the transfer is subject to but exempt from VAT in accordance with the law.

The question raised

Extension of the binding ruling of May 7, 2020, consultation V1297-20, in light of the new facts brought to light by the applicant.

The DGT's ruling

If the material urbanization works have not been initiated on the property prior to its transfer, the delivery is subject to but exempt from Value Added Tax pursuant to Article 20.One.20º of the Tax Law. The existence or commencement of said works is a matter of fact that must be proven by the interested party through the relevant means of evidence.

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