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V5375-16 20 December 2016 · SG de Impuestos sobre el Consumo Criterion in force
IVA · tipo impositivo

Demolition works and archaeological studies subject to 21% VAT

A private individual enquired whether the demolition of a dwelling and the archaeological studies preceding construction could qualify for the reduced VAT rate. The Directorate General for Taxes (DGT) ruled that these operations do not constitute construction works and must be taxed at the standard rate.

The question raised

Applicable tax rate for the demolition works of the previous building, as well as for the excavation and archaeological study prior to construction.

The DGT's ruling

Demolition or knockdown operations of existing buildings on a plot are not considered construction works for the building of edifices. Therefore, they are taxed at the general rate of 21%. Likewise, archaeological study services and the preparation of reports on land prior to construction do not qualify for the reduced rate of 10%.

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