Palma (+34) 971 49 58 35 | Manacor (+34) 971 55 31 61

The following operations are subject to the reduced rate (10%):

Construction or refurbishment (rehabilitación) works on buildings primarily intended for housing, including premises, garages, and annexes, resulting from contracts directly formalized between the promoter and the contractor. (The reduced rate does not apply to subcontracts). Buildings are considered primarily intended for housing when at least 50% of the constructed area is designated for residential use.

Sales with the installation of kitchen and bathroom cabinets and built-in wardrobes for homes, resulting from contracts directly formalized between the promoter of the construction or refurbishment (rehabilitación) and the contractor.

Construction works directly formalized with Property Owners’ Communities for the construction of garages in buildings primarily intended for housing, provided they are carried out on common land, and the number of spaces to be allocated to each owner does not exceed two.

Deliveries without installation of doors, windows, cabinets, kitchen furniture, etc., for construction works in buildings will always be subject to the general rate of 21%, as it does not qualify as construction work.

The extension of a residence that increases the habitable area is considered construction and is subject to the 10% rate. Interior renovation works in a residence are not considered construction.

 Refurbishment (rehabilitación) Works

The concept of what are refurbishment (rehabilitación) works can be very different for different people.  An architect, a builder and the owner of a property may claim that they are carrying out the refurbishment of a property, but the said work may be classified by the tax authorities as simple reform work subject to a VAT rate of 21% or refurbishment work subject to a VAT rate of 10% depending on whether certain conditions are strictly complied with.

To determine if performed works qualify as refurbishment (rehabilitación) and are subject to the reduced rate of 10%, two requirements must be met:

  1. More than 50% of the total cost of the refurbishment (rehabilitación) project must correspond to consolidation or treatment works on structural elements, facades, or roofs, or analogous works or connected works to refurbishment (rehabilitación).

For this purpose, it will be necessary to have sufficient evidence proving the true nature of the planned works, such as opinions from professionals specifically qualified for this purpose, or the approval and, if applicable, qualification of the project by professional associations.

  1. If the first requirement is met, the total amount of the works must exceed 25% of the acquisition price of the building (if acquired in the two years prior to the start of refurbishment (rehabilitación) works) or the market value of the building before refurbishment (rehabilitación), deducting the land value in both cases.

Analogous works to Refurbishment (rehabilitación)

These include structural adaptation works that provide constructive safety conditions to the building, ensuring its stability and mechanical resistance.

Works involving reinforcement or adaptation of the foundation, as well as those affecting or consisting of the treatment of pillars or floors.

Works expanding the constructed area, above and below ground.

Reconstruction of facades and interior courtyards.

Installation of lifting elements, including those designed to overcome architectural barriers for use by disabled individuals.

 Works Connected to Refurbishment (rehabilitación)

Works connected to refurbishment (rehabilitación) will be considered as follows when their total cost is lower than that derived from consolidation or treatment works on structural elements, facades, or roofs and, if applicable, works similar to these, provided they are indissolubly linked to them and do not consist solely of the finishing or ornamentation of the building or the simple maintenance or painting of the facade:

Masonry, plumbing, and carpentry works.

Works aimed at improving and adapting enclosures, electrical installations, water and air conditioning, and protection against fires.

Energy refurbishment (rehabilitación) works.

Energy refurbishment (rehabilitación) works are considered those aimed at improving the energy performance of buildings by reducing their energy demand, increasing the efficiency of thermal systems and installations, or incorporating equipment using renewable energy sources

VAT rate in Spain for renovation and refurbishment (rehabilitación) work on houses and homes EN


Miquel Angel Riera Vallés

Abogado-Asesor fiscal



Este sitio web utiliza cookies para que usted tenga la mejor experiencia de usuario. Si continúa navegando está dando su consentimiento para la aceptación de las mencionadas cookies y la aceptación de nuestra política de cookies.

Aviso de cookies