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V2911-18 14 November 2018 · SG de Impuestos sobre el Consumo Criterion in force
IVA · comunidad de bienes

Allocation of housing by a self-build community to its members is subject to 10% VAT

A company manages a joint ownership community that develops housing and covers construction costs until new members join. The DGT has ruled that the joint ownership community is the taxable person and must apply the reduced 10% rate when allocating housing to a new member.

The question raised

Taxation of the operation within the scope of Value Added Tax.

The DGT's ruling

Communities of property that promote the construction of buildings for allocation to their members are entrepreneurs and taxable persons for VAT purposes. The allocation of housing to members in proportion to their share is a supply of goods subject to the reduced rate of 10%. When a new member replaces the managing entity, the community must modify the tax base and charge the corresponding tax to the new member.

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