VAT in terms of real estate purchases (April 2008)

IVA (Impuesto Valor Añadido) [VAT (Value Added Tax)] is one of the taxes involved in the purchase of a newly-constructed property. It is calculated by applying a percentage to the price that appears on the deed, which varies depending on whether the property is freehold or protección oficial and on the Autonomous Community in which the property is located.

The buyer is therefore obliged to pay this amount, the sum of which is included in the various payments made by the buyer to the developer.

a) 7% for homes, including garage spaces, to a maximum of two units, and annexes (basements, lofts, storerooms.) located therein, provided that they are sold as a whole, in other words, at the same time, on the same date and before the same Notary Public, irrespective of whether they appear i n the same or different private documents or public instruments.