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V4825-16 10 November 2016 · SG de Impuestos sobre el Consumo Criterion in force
IVA · exención

Genetic tests for disease detection may be VAT exempt if performed by medical or healthcare professionals

A company has requested clarification on whether genetic testing to detect disease predispositions or drug incompatibilities is exempt from VAT. The DGT has ruled that, as these services serve diagnostic and preventive purposes, they are exempt provided they are performed by medical or healthcare professionals.

The question raised

Whether the services provided by the applicant are exempt from Value Added Tax pursuant to the provisions of Article 20.One.3º of Law 37/1992.

The DGT's ruling

The exemption under Article 20.One.3º of Law 37/1992 requires a subjective requirement (medical or healthcare provider) and an objective requirement (services for the diagnosis, prevention, or treatment of diseases). Genetic tests to detect predisposition to diseases, pharmacological incompatibilities, or hereditary diseases are for diagnostic and preventive purposes. Therefore, they are exempt if performed by a medical or healthcare professional, even if acting through a commercial company. If these requirements are not met, they shall be taxed at the general rate of 21%.

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