Grupo Vapf

New Tax deduction in Spanish housing

We want to share with all our customers the latest financial news that Spanish Government has recently enacted: The newly built luxury homes, houses on the beach and second homes and  parking spaces will have a reduced VAT.

In the Post published last 2 January, 2012, we commented that reduced VAT would be kept during 2012, exclusively for first homes, as reported by the Spanish Prime Minister in his inaugural speech. NEW Spanish Prime Minister, Mariano Rajoy, also indicated that this measure was not final because it was pending for revision.

After made all appropriate studies, the conclusion was that the  reduced VAT (from 8% to 4%) will be applied for new housing without discrimination by housing type, according to information published in the Official Gazette No. 315 of Saturday 31 December , 2011, under the Royal Decree 20/2011 of  urgent budgetary, tax and financial measures to correct the national deficit.

The fourth transitory provision of Royal Decree-Law referred to the applicable tax rate of housing VAT states that the rate of 4% Tax will be applicable to households classified as special protection regime official, when the purchase is made directly from the promoter or builder of the Estate or garages and annexes located in the same building always it is under the same deed and not exceed two parking units.