The purpose of these notes is to summarise the special tax regime for entities whose main economic activity is the rental of homes. The main incentives affect Corporation Tax (IS) and Value Added Tax (VAT).<\/p>\n<\/div><\/div><\/div><\/div><\/div>
Article 91.dos.1.6\u00ba of Law 37\/92 (LIVA) provides, in its second paragraph, the application of the reduced tax rate of 4% to deliveries of homes that are acquired by entities that apply the special regime provided for in articles 48 and 49 of the LIS, provided that the income derived from its subsequent lease applies to the bonus established in the aforementioned articles.<\/p>\n
The acquiring entity must notify the taxpayer, before the accrual of the transaction, that it has the right to apply the special regime and that the rents are applicable to the income derived from its subsequent lease. Such circumstances may be proven by means of a written statement signed by the aforementioned addressee addressed to the taxpayer, stating, under his responsibility, compliance.<\/p>\n
The application of the reduced rate of 4% applies to the acquisitions of finished homes made by an entity that, at the time of said acquisition, still did not meet the requirements to be able to apply the special regime provided for in the LIS, provided that it said the entity had the intention, confirmed by objective elements that must be present on the acquisition date, to dedicate the homes it acquires in the year following the lease and will be entitled to the bonus established in article 49.1 of the LIS regarding the income that will be received from the referred lease.<\/p>\n
The special regime explained above is a very interesting option for entities that own more than eight homes that are dedicated to renting them.<\/p>\n
The most important tax benefits are the taxation by I.S. at 3.75% (instead of 25%) and by VAT, on the acquisition of homes, at 4% (instead of 10%).<\/p>\n<\/div><\/div><\/div><\/div><\/div>