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Clarification on the Cases of Non-Applicability of VAT to Lease Back Operations

Marco Fernández Jun 3, 2024

The AEAT has issued a new consultation that helps clarify how lease-back operations should be taxed under VAT.

Leaseback is a reverse leasing operation, meaning it is an operation where the owner of an asset sells it to a financial entity and, at the same time, enters into a lease agreement for the same asset.

The AEAT has published new criteria in its binding consultation V0258-24 regarding the VAT treatment of this type of operations.

The DGT clarifies that, in principle, leaseback transactions are subject to VAT, thereby eliminating the possibility of a potential exemption.

Non-applicability of VAT can only be used when the transferred elements are part of an economic unit capable of generating income independently. However, in the more common leaseback operations where real estate is transferred without constituting an organized production unit, this criterion is not met.

It is also specified that the transfer of the property should be considered and treated separately from its subsequent lease, with each one being independent and different operations for VAT purposes.

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