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V2326-14 9 September 2014 · SG de Impuestos sobre el Consumo Criterion in force
IVA · rehabilitación de edificaciones

Reduced 10% VAT rate applicable to building rehabilitation or renovation and repair works subject to specific requirements

A homeowners' association has requested clarification on the VAT rate applicable to repair works in a residential building. The Directorate General for Taxes (DGT) explains that a 10% rate may be applied if the works constitute rehabilitation, renovation, or repair, provided certain requirements are met.

The question raised

Question raised: Applicable tax rate for the described works.

The DGT's ruling

For rehabilitation works, a 10% rate applies if the primary objective is reconstruction (more than 50% of the cost in structural elements, facades, or roofs) and the cost exceeds 25% of the value of the property excluding the land. For renovation and repair works, the rate is 10% if the recipient is a homeowners' association or a natural person for private use, two years have passed since construction, and the cost of materials does not exceed 40% of the tax base. If these requirements are not met, the general rate of 21% applies.

Apply this to a real case

What is published here, applied to a company or a specific case. The first meeting is free.

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