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Improvement Works: 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 10 rulings · 2016–2026

Current position

Improvements carried out by the developer in a property pending delivery are considered part of the sale price and are taxed at a 10% IVA (Value Added Tax) rate. If the acquirer contracts the works directly with the builder, the general rate of 21% applies. To apply the reduced renovation rate, the construction must have been completed at least two years prior to the works.

The DGT's position remains constant regarding the treatment of IVA in improvement works. It is confirmed that the 10% reduced rate depends on the direct contractual relationship between the developer and the contractor. No doctrinal changes are observed, but rather a reiteration of the requirements for the application of the reduced rate.

Analysis based on 10 of 10 rulings with a stated position. Updated 28 September 2026.

Rulings on this topic

10
V0780-26 8 Apr 2026

Improvements to a home before delivery qualify for 10% VAT rate

SG de Impuestos sobre el Consumo
obras de mejoratipo reducidorectificación de cuotasentidad promotoraprecio de venta LIVA — Ley 37/1992 del IVA art. 4LIVA — Ley 37/1992 del IVA art. 5
Affects CompanyExpat · Non-residentIndividual

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