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Installation and Assembly: 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 25 rulings · 2014–2023

Current position

The reverse charge mechanism applies to construction, rehabilitation, or urbanization works when the recipient is an entrepreneur or professional. For the supply of goods to constitute a work execution, it must involve installation and assembly that goes beyond mere making available. In rehabilitations, the main object must be reconstruction and the cost must exceed 25% of the building's value.

The DGT's position remains constant regarding the definition of work execution, always requiring installation and assembly so that the supply is not a mere delivery of goods. Throughout the rulings, the requirement that the operation be the consequence of a construction or rehabilitation contract has been maintained. No changes in criterion are observed, but rather a reiteration of the technical requirements for the application of the reverse charge mechanism.

Analysis based on 24 of 25 rulings with a stated position. Updated 24 September 2026.

Rulings on this topic

24
V2693-23 3 Oct 2023

Reverse charge mechanism applied to building renovation works

SG de Impuestos sobre el Consumo
inversión del sujeto pasivorehabilitación de edificacionesejecución de obraempresario o profesionalinstalación y montaje LIVA — Ley 37/1992 del IVA art. 4.1LIVA — Ley 37/1992 del IVA art. 5.1
Affects CompanyExpat · Non-residentIndividual
V1496-22 22 Jun 2022

Supply of concrete depends on whether installation or mounting is included

SG de Impuestos sobre el Consumo
inversión del sujeto pasivoejecución de obrasuministro de materialesinstalación y montajeempresario o profesional LIVA — Ley 37/1992 del IVA art. 84.Uno.2º, letra f)RIVA — RD 1624/1992, Reglamento del IVA art. 24 quater
Affects CompanyExpat · Non-residentIndividual
V3186-21 23 Dec 2021

Supply of equipment without installation excludes passive investment

SG de Impuestos sobre el Consumo
inversión del sujeto pasivoejecución de obrasuministro de bienesinstalación y montajeempresario o profesional LIVA — Ley 37/1992 del IVA art. 4.unoLIVA — Ley 37/1992 del IVA art. 4.dos
Affects CompanyExpat · Non-residentIndividual
V0383-21 25 Feb 2021

Installation with mounting may qualify for passive party VAT investment

SG de Impuestos sobre el Consumo
inversión del sujeto pasivoejecución de obrainstalación y montajesuministro de bienesempresario o profesional LIVA — Ley 37/1992 del IVA art. 4.UnoLIVA — Ley 37/1992 del IVA art. 5.Uno
Affects CompanyExpat · Non-residentIndividual
V4485-16 18 Oct 2016

Inversion of the passive party not applicable to supply of uninstalled goods

SG de Impuestos sobre el Consumo
inversión del sujeto pasivoejecución de obrassuministro de bienesinstalación y montajerehabilitación de edificaciones LIVA — Ley 37/1992 del IVA art. 84.Uno.2º.f)LIVA — Ley 37/1992 del IVA art. 90.Uno
Affects CompanyExpat · Non-residentIndividual
V0099-15 15 Jan 2015

Subject passive investment depends on compliance with LIVA art. 84.1.2.f

SG de Impuestos sobre el Consumo
inversión del sujeto pasivoejecución de obrarehabilitación de edificacionesurbanización de terrenosinstalación y montaje LIVA — Ley 37/1992 del IVA art. 84.Uno.2º.fLIVA — Ley 37/1992 del IVA art. 20.Uno.22º
Affects CompanyExpat · Non-residentIndividual

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