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V2506-19 17 September 2019 · SG de Impuestos sobre el Consumo Criterion in force
IVA · tipo impositivo reducido

10% VAT rate applies to water and electricity connections on-site, while 21% applies to meters and technical studies

A self-developer has requested clarification on the VAT rates applicable to various works for their primary residence. The DGT has ruled that water and electricity connections within the plot are subject to the 10% rate, whereas the installation of meters and technical studies are subject to the 21% rate.

The question raised

Issue raised - Applicable tax rate for Value Added Tax purposes.

The DGT's ruling

Works for the construction or renovation of residential buildings are taxed at 10% if formalized directly between the developer and the contractor. However, the installation of meters (provisional or definitive), geotechnical studies, and material testing are taxed at the general rate of 21%. Water and electricity connections carried out within the plot to connect with the general networks are considered subject to the reduced rate of 10%.

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