Doctrine by topic · DGT Observatory

Recipient of the Service: DGT doctrinal evolution

How the DGT's position on this topic has evolved, and the rulings it rests on.

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How the DGT's position has evolved

Settled doctrine High confidence 17 rulings · 2014–2024

Current position

The recipient of the service is the party holding the position of creditor in the legal relationship or the party obligated to make the payment. In the case of legal costs, the winning party is the recipient and must receive the invoice, whereas the payment from the losing party is compensation not subject to IVA (Value Added Tax). In home repairs, the reduced rate of 10% requires that the legal and material recipient be the natural person or the community of owners.

The DGT's position remains constant in identifying the recipient as the holder of the legal relationship. A consistent application of the criterion is observed in both professional services and repairs, where the distinction between the material payment and the ownership of the service is key to determining the application of the tax rate or the liability to the tax.

Turning points

18 September 2019 V2532-19

Specifies that if the insurer replaces compensation with direct repair, the recipient becomes the insurer and the general rate of 21% applies.

Analysis based on 16 of 17 rulings with a stated position. Updated 25 September 2026.

Rulings on this topic

17

V2253-24 22 Oct 2024

Payment of legal costs does not trigger VAT or require an invoice for the payer

SG de Impuestos sobre la Renta de las Personas Físicas

condena en costasindemnizaciónsujeción al impuestodestinatario del serviciogastos de defensa LIVA — Ley 37/1992 del IVA art. 4.1LIVA — Ley 37/1992 del IVA art. 5.1

Affects CompanyExpat · Non-residentIndividual

V2106-24 27 Sept 2024

Payment of legal costs is not subject to VAT and can be claimed as an expense or loss for Income Tax purposes

SG de Impuestos sobre la Renta de las Personas Físicas

costas judicialesindemnizaciónsujeción al impuestogastos deduciblespérdida patrimonial LIVA — Ley 37/1992 del IVA art. 4.1LIVA — Ley 37/1992 del IVA art. 5.1

Affects CompanyExpat · Non-residentIndividual

V2188-23 26 Jul 2023

Legal service invoices cannot be demanded by the party liable for costs, as they are not the recipient of the service

SG de Impuestos sobre el Consumo

costas judicialesindemnizaciónprestación de serviciosbase imponiblesujeto pasivo LIVA — Ley 37/1992 del IVA art. 4.1LIVA — Ley 37/1992 del IVA art. 5.1

Affects CompanyExpat · Non-residentIndividual

V2461-22 30 Nov 2022

Livestock services provided to a cooperative are subject to 21% VAT, not the 10% reduced rate

SG de Impuestos sobre la Renta de las Personas Físicas

régimen especial de la agricultura, ganadería y pescarégimen simplificadotipo reducidoestimación objetivadestinatario del servicio LIVA — Ley 37/1992 del IVA art. 90LIVA — Ley 37/1992 del IVA art. 91

Affects CompanyExpat · Non-residentIndividual

V1556-22 29 Jun 2022

Vacation rental management services must be invoiced to the service recipient

SG de Tributos

intermediacióncesión de usodestinatario del serviciomodelo 179plataformas colaborativas LIVA — Ley 37/1992 del IVA art. 4.UnoLIVA — Ley 37/1992 del IVA art. 5

Affects CompanyExpat · Non-residentIndividual

V0390-22 28 Feb 2022

Expenses paid on behalf of end customers cannot be included as disbursements in the dealer's invoice

SG de Impuestos sobre el Consumo

suplidosbase imponiblemandato expresodestinatario del serviciorepercusión del impuesto LIVA — Ley 37/1992 del IVA art. 78LIVA — Ley 37/1992 del IVA art. 88

Affects CompanyExpat · Non-residentIndividual

V2532-19 18 Sept 2019

The reduced VAT rate of 10% may be applied to accident repairs if the recipient is the insured party

SG de Impuestos sobre el Consumo

tipo reducidodestinatario del servicioindemnizaciónresarcimientoreparación de siniestros LIVA — Ley 37/1992 del IVA art. 90LIVA — Ley 37/1992 del IVA art. 91.Uno.2.10º

Affects CompanyExpat · Non-residentIndividual

V0989-19 8 May 2019

10% reduced VAT rate applicable to home repairs if the recipient is the insured party

SG de Impuestos sobre el Consumo

tipo impositivo reducidodestinatario del servicioindemnizaciónreparación de viviendasresarcimiento LIVA — Ley 37/1992 del IVA art. 90LIVA — Ley 37/1992 del IVA art. 91.Uno.2.10º

Affects CompanyExpat · Non-residentIndividual

V0540-19 13 Mar 2019

Legal costs are exempt from VAT for the losing party and may constitute capital gains for the winner

SG de Impuestos sobre la Renta de las Personas Físicas

condena en costasindemnizaciónasistencia jurídica gratuitaganancia patrimonialdestinatario del servicio LIVA — Ley 37/1992 del IVA art. 1LIVA — Ley 37/1992 del IVA art. 4

Affects CompanyExpat · Non-residentIndividual

V0010-18 6 Jan 2018

10% reduced VAT rate applies to home repairs when the recipient is the insured party

SG de Impuestos sobre el Consumo

tipo impositivo reducidodestinatario del servicioindemnizaciónejecución de obrareparación de vivienda LIVA — Ley 37/1992 del IVA art. 90LIVA — Ley 37/1992 del IVA art. 91.Uno.2.10º

Affects CompanyExpat · Non-residentIndividual

V1150-17 16 May 2017

10% reduced VAT rate applies to home repairs if the recipient is the insured party

SG de Impuestos sobre el Consumo

tipo impositivo reducidodestinatario del servicioejecución de obraresarcimientoindemnización LIVA — Ley 37/1992 del IVA art. 90LIVA — Ley 37/1992 del IVA art. 91.Uno.2.10º

Affects CompanyExpat · Non-residentIndividual

V0668-17 15 Mar 2017

Consultant acts as an intermediary in its own name when receiving and providing motorway and parking services

SG de Impuestos sobre el Consumo

mediación en nombre propioprestación de serviciosintermediaciónsujeto pasivodestinatario del servicio LIVA — Ley 37/1992 del IVA art. 11.dos.15ºLGT — Ley 58/2003 General Tributaria art. 89.1

Affects CompanyExpat · Non-residentIndividual

V0285-17 3 Feb 2017

10% reduced VAT rate applies to home repairs if the recipient is the insured party rather than the insurer

SG de Impuestos sobre el Consumo

tipo impositivo reducidodestinatario del servicioejecución de obragestión de siniestrosnombre propio LIVA — Ley 37/1992 del IVA art. 90LIVA — Ley 37/1992 del IVA art. 91.Uno.2.10º

Affects CompanyExpat · Non-residentIndividual

V4622-16 31 Oct 2016

10% reduced VAT rate applies to home repairs if the platform acts in its own name towards the insured

SG de Impuestos sobre el Consumo

tipo impositivo reducidodestinatario del servicionombre propiogestión de siniestrosejecución de obra LIVA — Ley 37/1992 del IVA art. 90LIVA — Ley 37/1992 del IVA art. 91.Uno.2.10º

Affects CompanyExpat · Non-residentIndividual

V3655-15 23 Nov 2015

Assignment of trademark rights is subject to VAT if the recipient is a business or if used effectively in Spain

SG de Impuestos sobre el Consumo

cesión de derechosuso efectivodestinatario del serviciobase imponibleindemnización LIVA — Ley 37/1992 del IVA art. 69.Uno.1ºLIVA — Ley 37/1992 del IVA art. 69.Dos.a

Affects CompanyExpat · Non-residentIndividual

V0677-15 26 Feb 2015

Legal costs invoices must be issued to the winning party, not the losing party

SG de Impuestos sobre el Consumo

costas judicialesindemnizaciónbase imponibleprestación de serviciosdestinatario del servicio LIVA — Ley 37/1992 del IVA art. 4.UnoLIVA — Ley 37/1992 del IVA art. 78.Tres.1º

Affects CompanyExpat · Non-residentIndividual

V0392-14 14 Feb 2014

VAT cannot be passed from the winning party to the losing party in a costs order

SG de Impuestos sobre el Consumo

condena en costasindemnizaciónbase imponibleprestación de serviciosdestinatario del servicio LIVA — Ley 37/1992 del IVA art. 4.UnoLIVA — Ley 37/1992 del IVA art. 78.3.1º

Affects CompanyExpat · Non-residentIndividual

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