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V2763-14 14 October 2014 · SG de Impuestos sobre el Consumo Criterion in force
IVA · inversión del sujeto pasivo

No application of passive party inversion in wastewater treatment plant delivery

A municipal society asks whether the delivery of expansion works for a wastewater treatment plant is subject to passive party inversion in VAT. The DGT determines that this mechanism does not apply as the works are not derived from direct contracts between promoter and contractor.

The question raised

Reverse charge mechanism in the delivery of expansion works to the taxpayer.

The DGT's ruling

Wastewater treatment plants (WWTPs) are considered buildings for VAT purposes. The reverse charge mechanism under Article 84.One.2º, letter f) of Law 37/1992 does not apply because the delivery of the building is not a consequence of contracts directly entered into between the developer and the contractor.

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