Transmission of commercial property after being leased for more than two years
The biding tax ruling number 1653/2014 issued by the Spanish General Tax Directorate, explains the treatment for a commercial property to be acquired by third parties to whom they transferred the early tenants, under deed. Accordingly, the purchaser is to be a person other than the one who used the building for a period of two years after the construction was finished so that the transmission of such areas is considered second delivery for the purposes of Article 20.Uno.22º of Law 37/1992 and therefore exempt of VAT.
Notwithstanding the foregoing, if the transfer had been a result of the merger or division of the original tenant company, the third party purchaser would take over the position of the original tenant, being considered this transaction as a first delivery subject and not exempt of VAT.
Due to the application of this exemption, it would be possible applying for the waiver of exemption if the statutory requirements are met.
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