The management of VAT in the rental of a property varies depending on the different operations that are carried out, since VAT is applied to each of them in a different way, depending on whether the rental of the property is for commercial use, housing, etc. We detail it below:
Bonds and indemnities:
- Deposit: it does not have VAT as it is compensatory.
- Compensation for termination of the contract:
- If paid by the tenant: it is not part of the tax base.
- If paid by the owner: it is subject to VAT.
- Compensation for works on the premises: not part of the tax base.
VAT on rentals:
- Home rental: exempt from VAT but subject to ITP.
- With purchase option:
- If the lessor is a financial leasing company or property developer, it must pay 10% VAT.
- If they are officially protected homes, at 4% VAT.
- As a law firm: 21% VAT as it is not used exclusively as a home.
- To a doctor, intended for housing and consultations: 21% VAT since it is not used exclusively as housing.
- From a company to an employee of yours: exempt from VAT but subject to ITP.
- From the owner to a real estate agency: 21% VAT since the tenant does not use it as a home, but instead rents it out.
- From a real estate agency to a private individual: exempt from VAT. Exempt from ITP if it is for stable and permanent use.
- To an association/foundation for a free transfer: exempt from VAT but subject to ITP.
- With purchase option:
- Rental of a tourist apartment: VAT exempt, as long as the hotel industry services are not provided. If such services are provided, the rent will be taxed at 10%.
- Rental of a garage space:
- If it is rented together with the house, it is exempt from VAT.
- If it is not rented jointly with the home, the landlord must charge 21% VAT.
- Rental of a premises: 21% VAT.
- Rental of a plot: 21% VAT.
VAT on transfers or sales of premises:
- Transfer of use of premises for free:
- If the owner is registered in the census: it is subject to VAT of 21%.
- If you are not registered: you are not subject to VAT.
- Transfer of the rental of a premises: the transfer of rental rights is subject to VAT of 21%.
- Commercial premises to convert it into housing: it will be considered housing if it has a certificate of habitability or first occupation license. 10% VAT is applied if the work meets the requirements to be considered rehabilitation or renovation / repair work.
- Sale of the premises at the end of the rental contract:
- If the liquidation of all the assets has not occurred, it is subject to VAT.
- Sale of business (transfer except premises, which is leased): not subject to VAT if the goods are accompanied by the organizational structure and the production factors necessary to carry out the activity by their own means.
- Purchase of second-hand premises for rent: the seller can waive the exemption, making the purchase taxed by VAT and not by ITP. In addition, the rental of the premises converts the individual into an entrepreneur for VAT purposes.
VAT on works and repairs:
- Works in premises: 21% VAT.
- Home repairs carried out by the owner: 21% VAT.
If you have any questions, contact us at 93 458 83 05 ext. 2 and we will solve it for you.
