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V5379-16 20 December 2016 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
IVA · concesión de obra pública

Transfer of use of a swimming pool after construction is classified as a first supply of goods subject to VAT

A company holding a public works concession has enquired whether the termination of the contract and the amounts received are subject to VAT. The DGT has determined that the transfer of use constitutes a supply of goods subject to the tax, whereas compensation for damages does not form part of the taxable base.

The question raised

At this time, a new inquiry is formulated regarding the specification of the response concerning the definition of the figure of the developer, in order to determine whether it fits within the figure of the concessionaire.

The DGT's ruling

The transfer of the use of the swimming pool to the City Council is classified as a supply of goods, being a first supply of a building subject to VAT when carried out by the developer. The tax liability arises when the swimming pool is placed in the possession of the City Council. Amounts for unamortized investments are not consideration subject to tax, and compensation for loss of profits and damages do not constitute consideration for transactions subject to VAT.

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