COMMUNITY OF OWNERS
COMMUNITY OF OWNERS: VAT RECOVERY FOR SPANISH COMPANIES.
An important part of the property owned by the companies will be integrated into a community of owners. These communities of owners are considered final consumers for the purposes of the VAT Law and therefore cannot be deducted from the fees paid on the occasion of such tax (supplies, maintenance of common areas, repairs …).
Subsequently, the receipts to be paid periodically are sent to the co-owners/owners, including in the corresponding quota the VAT that the communities of owners have had to bear.
REDUCTION OF PROPORTIONAL FEE FOR SUPPORTED VAT. REQUIREMENTS AND CONDITIONS FOR THIS DEDUCTIBILITY.
The role of the European Court of Justice is to ensure that EU legislation is complied with by Member States. This court has determined the suppositions and requirements in which an owner (who must belong to a community of owners) can deduct VAT from the proportional part of the quota that his community has supported, based on his share of participation.
Case-Law:
• Judgment of the Court of Justice of the European Communities, dated April 21, 2005
• Binding consultation V0027-14 of January 31 of the General Directorate of Taxes
DEDUCTIBILITY CRITERIA.
This right to deduct may be exercised by businessmen or professionals who are in possession of the supporting document: original or duplicate invoice validly issued in the name of the community of owners.
It will be necessary to certify the participation fee in the corresponding community of owners through other types of documents (horizontal division deed and new work, community statutes, simple note …)
Procedure for deduction.
60days receives an authorization from the employer or professional owner of the property to request, either from the community of owners, or directly from the suppliers of the property, original or validly duplicate issued invoices issued to the community during the last 4 years.
Once the invoices or duplicates have been received, the corresponding data is extracted so that, once the shareholder’s coefficient is applied, the input tax can be deducted in the next tax declaration.
This operation allows entrepreneurs or professionals to obtain short-term income. This is what we refer to as CASH RECOVERY.
ELECTRICITY
Recover the VAT from electricity bills.GENERAL EXPENSES
Recover the VAT incurred from expenses generated from the elecricity used in the common areas of the building, lighting, lifts etc..
REPAIRS
Repairs, painting, building facades...EXTRAORDINARY EXPENSES
Painting the building facade, plumbing or electrical repairs, unexpected expenses that can arise in the day to day.
CLEANING
Services contracted to third parties.CONCIERGE SERVICES
Services such as cleaning, maintanance and other third party repairs and works carried out are also subject to VAT deduction
