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V3174-14 27 November 2014 · SG de Impuestos sobre el Consumo Criterion in force
IVA · operación empresarial

Accommodation and catering services at Military Residences are subject to VAT at the 10% rate

A query was raised regarding whether accommodation and catering services provided by Military Residences are exempt due to social action or are not subject to VAT. The DGT has determined that these are business operations subject to the tax, applying the reduced rate for the hospitality sector.

The question raised

Taxation of the services provided. Application of the exemption for social action, or alternatively, non-subjectivity to Value Added Tax.

The DGT's ruling

The services provided by Military Residences constitute a business operation subject to VAT as they are not operations without consideration, since they are based on public prices. The exemption for social assistance is not applicable because the services do not conform to the benefits specified in said article. Therefore, they are taxed at the 10% rate as hospitality services.

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