VAT when buying a new home, everything you need to know

December 15 the 2022

What is a new construction home?

The Tax Agency defines new construction homes as "those that are acquired from the promoter when the construction or rehabilitation is finished (certified by issuing the completion certificate, which must be signed by the corresponding architect and surveyor. ).

On the other hand, in those homes that are not new construction (that is, they have already been used by other people for a period equal to or greater than two years before the sale), there will be no obligation to pay VAT, and must be done through the Tax on Onerous Patrimonial Transmissions, considering a second transmission.

Therefore, and unless a situation such as the one previously mentioned occurs, it must be taken into account that the buyer will always be obliged to pay VAT when acquiring a new home. Payment will be made directly to the seller, who is obliged to enter the VAT amount of the purchase of the house at the Public Treasury.

How much is VAT on new housing?

The VAT for a new home is 10% of its deeded amount, except in the case of officially protected homes under the special regime or public promotion, cases in which the tax is 4%.

The same VAT rate as that of a new construction home is applied to parking spaces (with a maximum of two units for new construction housing) and to the annexes that are transferred (the storage room, for example).

Another exceptional case is commercial premises, which will have a 21% VAT. This tax rate is also applied to garage spaces, but only if there is an amount greater than the two previously mentioned units.

When is VAT paid on a new home?

The VAT on a new home is paid at the time the deeds are signed, that is, they are paid together with the rest of the payment for the home.

BBVA source Link

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