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V2784-16 21 June 2016 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IVA · subarriendo

Residential leasing with sub-letting authorisation to a company is subject to VAT and ineligible for IRPF tax reductions

A community of property has enquired whether the tax treatment changes when authorising the sub-letting of a residential property to a company. The DGT has ruled that the transaction becomes subject to VAT at 21% and loses the residential leasing tax reduction for Personal Income Tax (IRPF).

The question raised

Question posed: Tax treatment of said lease once the annex is included, both for Personal Income Tax (IRPF) and VAT.

The DGT's ruling

The lease of a dwelling to a natural person who subsequently subleases it to a company is subject to and not exempt from VAT at the general rate of 21%. For Personal Income Tax (IRPF) purposes, since the dwelling is not intended for the lessee but for a third party, the reduction for the lease of properties intended for housing under Article 23.2 of the LIRPF does not apply.

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