Skip to content
Back to index
V3281-18 27 December 2018 · SG de Impuestos sobre el Consumo Criterion in force
IVA · arrendamiento con opción de compra

Granting a purchase option in a lease is considered a service subject to VAT

An individual requested clarification on the VAT treatment of the premium charged at the start of a lease agreement with a purchase option. The DGT ruled that the purchase option constitutes a provision of services as long as there is no commitment to exercise it, whereas the transfer of the property will be treated as a supply of goods.

The question raised

Taxation under Value Added Tax regarding the premium collected at the beginning of the contract for the purchase option.

The DGT's ruling

Lease with an option to purchase constitutes a provision of services until the lessee commits to exercising the option, at which point it becomes a supply of goods. The granting of the purchase option, being a mere right without the transfer of the power of disposal, constitutes a provision of services subject to the general rate of 21%. If the delivery of the dwelling is exempt as it is a second or subsequent delivery, the lease shall also be subject but exempt.

Book your free first meeting