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V2532-19 18 September 2019 · SG de Impuestos sobre el Consumo Criterion in force
IVA · tipo reducido

The reduced VAT rate of 10% may be applied to accident repairs if the recipient is the insured party

A repair company inquires whether it can invoice at the 10% VAT rate when the insurer pays the invoice by reimbursement. The DGT responds that this is possible if the actual recipient of the service is the insured party or the homeowners' association and the requirements of the Law are met.

The question raised

Question posed: Correction of the issuance of the invoice in the name of the insured client at the reduced VAT rate of 10 percent.

The DGT's ruling

The reduced rate of 10% applies if the legal and material recipient is the natural person using the dwelling or the homeowners' association. In the case of compensation, the insured party is the recipient and must contract the repair in their name, even if the insurer makes the actual payment. If the insurer substitutes the compensation for direct repair, the recipient is the insurer and the general rate of 21% shall apply.

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