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V2633-17 16 October 2017 · SG de Impuestos sobre el Consumo Criterion in force
IVA · concesión de obra pública

Handover of a hospital following early termination of a concession may be subject to VAT or exempt

The taxpayer seeks clarification on the VAT treatment regarding the reversion of a hospital to the Administration following the early termination of a concession contract. The DGT explains that the handover constitutes a supply of goods subject to VAT, unless an autonomous economic unit is transferred or the exemption for second-hand building transfers applies.

The question raised

Value Added Tax treatment regarding the termination of the concession contract.

The DGT's ruling

The redemption of the hospital through early termination constitutes a supply of goods subject to VAT as the power of disposal is transferred. However, the transaction shall not be subject to VAT if an autonomous economic unit with its own organizational structure is transferred. If it is subject to VAT, the exemption for second supplies of buildings may apply, provided it has been used for more than two years.

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