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V2367-14 10 September 2014 · SG de Impuestos sobre el Consumo Criterion in force
IVA · base imponible

Community charges passed on in commercial rent must be included in the VAT taxable amount

A query was raised regarding whether community charges passed on to a commercial tenant should be included in the VAT taxable amount. The DGT ruled that these charges, along with other ancillary items, form part of the consideration subject to tax.

The question raised

Determination of the lease taxable base when expenses, such as the homeowners' association fee, are passed on.

The DGT's ruling

The VAT taxable base for real estate leases includes the rent and any effective credit from the lessor to the lessee derived from the principal or ancillary services. This includes community fees, utilities, works, improvements, or Property Tax (IBI), provided they are passed on to the lessee. The net amount must be included, excluding the VAT incurred by the lessor, although if an amount exceeding the actual expense is passed on, such difference also forms part of the taxable base. The applicable rate for these ancillary expenses is the general rate of 21 percent.

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