Key and lock workshops must pay tax under heading 691.2 of the IAE

The correct classification of economic activity in the Business Activity Tax (IAE) is fundamental to avoid contingencies with the Tax Administration. Recently, the Dirección General de Tributos (DGT) has clarified the tax placement of specialized technical services for vehicle opening and security systems.

What the DGT has resolved

The ruling analyzes the activity of companies dedicated to the programming of modules or electronic control units for automobile and motorcycle keys, as well as the repair of mechanical locks in permanent establishments. The binding body has determined that the programming of these chips, which consists of synchronization with the vehicle's control unit, must be taxed under heading 691.2 of the first section of the IAE Tariffs.

This heading includes the repair of any element or part of vehicles. Therefore, the activity of repairing mechanical locks and the replacement of parts necessary for such purpose are covered by this same classification. However, the DGT warns that if the business includes the independent sale of accessories, it will be necessary to register an additional commercial heading.

What it means for you

If your business focuses on technical assistance and the repair of key and lock systems, heading 691.2 is the appropriate one to group these operations. The key lies in the fact that electronic programming is considered an integral part of the repair of the vehicle element.

Companies must take special care if their business model is hybrid. If the main activity is technical service, but there is an income item from the sale of products or accessories that are not part of a direct repair, the IAE registration structure must reflect both natures to comply with current regulations.

What should be done

It is necessary to verify whether the current business model contemplates only the provision of services or if it includes the commercialization of products. In the event that the sale of accessories is a recurring activity separate from the repair, one must proceed to include a commercial heading to avoid errors in the declaration of economic activity. The correct choice of heading ensures that taxation is consistent with the operational reality of the establishment.