Skip to content
Back to index
V3495-20 2 December 2020 · SG de Impuestos sobre el Consumo Criterion in force
IVA · devengo

IVA due on urbanisation works upon administration acceptance or advance payments

A local council asks when VAT on urbanisation fees becomes due and whether the taxpayer's investment applies. The DGT responds that VAT becomes due upon completion of works (administration acceptance) or advance payments, and that the taxpayer's investment applies if legal requirements are met following the 2012 reform.

The question raised

Whether the accrual of Value Added Tax corresponding to said urbanization fee occurred when said invoice was issued or will occur upon payment thereof. Whether the reverse charge rule would be applicable.

The DGT's ruling

The accrual of urbanization service benefits occurs when the works are deemed completed, unless advance payments exist. If the recipient is a Public Administration, the accrual occurs at the time of receipt of the work. The reverse charge mechanism shall be applicable if the City Council acts as an entrepreneur or professional and the requirements of Article 84.one.2.f) of Law 37/1992 are met, provided that the accrual is subsequent to October 31, 2012.

Book your free first meeting