21% IVA on a Plot or House for Demolition: ITP or Waiver

If the seller of a buildable plot or a house for demolition acts as a business, the purchase carries IVA (impuesto sobre el valor añadido, Spanish VAT) of 21% and AJD (actos jurídicos documentados, stamp duty on notarial documents) of 1,5% instead of ITP (impuesto de transmisiones patrimoniales, property transfer tax); if the seller is a private individual, ITP is paid on the 10–13% scale (arts. 90 and 20 Ley 37/1992, art. 7.5 TRLITPAJD). Waiving the IVA exemption (renuncia a la exención) is the right of a seller who is a business to include IVA in a transaction the law exempts from it; it depends on the buyer's status. Below are three scenarios, a calculation with round numbers and the questions for the asesor fiscal (tax adviser). The tax side of the deal is set by the status of the parties and the object, not by what the buyer would like.

Which tax is paid when buying a plot or a house for demolition?

The choice between IVA and ITP is not decided by price but by three facts: who sells, what is sold and whether the transaction is exempt. The law does not allow both taxes on one transaction: transactions subject to IVA are not subject to ITP, except where they are exempt from IVA (art. 7.5 TRLITPAJD).

The law treats as buildable land classified as solar and any other land where building is authorised by a licence; rustic and non-buildable land is sold without IVA, but the exemption does not extend to urbanised land or land in the process of urbanisation (art. 20.Uno.20 Ley 37/1992). How your plot is classified can be seen from the certificate of the planning regime and from the article on land classes.

Why is a house for demolition taxed at 21% and not 10%?

For the first transfer of housing, IVA of 10% applies, but the law expressly excludes from «buildings suitable for housing» constructions intended for demolition (art. 91.Uno.1.7º). So buying an old house from a business in order to build anew on the plot goes at the general rate of 21%. There is a separate rule on exemption: the second and later transfers of buildings are usually exempt from IVA, but the sale of a building that will be demolished before new construction is not among them (art. 20.Uno.22.A.c). If the seller is a private individual, there is no IVA at all and scenario A applies. If the buyer is a gran tenedor and the house is registered as housing, the ATC (Agència Tributària de Catalunya) may apply the 20% rate for housing; how a house for demolition is classified is for the asesor fiscal to decide.

What does waiving the exemption give, and what does it require?

A waiver applies where the transaction is exempt (land not classed as buildable, a second transfer of a building) and the buyer is itself a business. The law allows it if the buyer acts in the course of a business activity and has the right to full or partial IVA deduction, or will use the property in operations that carry a right to deduct (art. 20.Dos). The Reglamento (implementing regulation) requires:

1. Notify the buyer of the waiver, by a means that proves the fact and the date of receipt (fehacientemente), before the transfer or at the same time.
2. Obtain from the buyer a written statement of its status and its right to deduct (art. 8 Reglamento IVA).

The tax in this case is accounted for by the buyer: this is the inversión del sujeto pasivo (reverse charge) (art. 84.Uno.2.e Ley 37/1992). AJD with a waiver in Catalonia is 3,5% for events from 27.06.2025, and 1,5% for transactions subject to IVA without a waiver (ATC). The AJD base per the ATC is the highest of the valor de referencia (official reference value), the declared value and the price.

What do the three scenarios look like in numbers?

Worked example, not a forecast and not market figures. A plot at 2 M€, the buyer a legal entity.

These turn into costs differently. If the buyer has the right to deduct all IVA, it will deduct the 420 000 € and the real loss is the AJD, although in cash flow the IVA has to be financed until it is refunded. If there is no right to deduct, IVA remains a cost. Which of the two applies to your structure is for the asesor fiscal to determine from the seller's documents and the project plan. Deduction is covered in the article on IVA in a project.

Real Decreto-ley 29/2026 of 6 October (in force from 8 October, not validated by Congress at 13.10.2026) changes, from 1 December 2026, the IVA on furnished-housing rentals, on renovation work and on certain types of protected housing. The rules on land and buildings for demolition (art. 20.Uno.20 and 22, art. 91.Uno.1.7º) are not affected by the instrument (BOE-A-2026-20823).

Who this does not suit

Someone who chooses the tax at will: the law sets it by the facts of the deal. Someone who buys on the assumption that «IVA always comes back»: deduction depends on the buyer's status and the kinds of operations it carries out. And someone who has not checked whether the seller is a business and how it accounts for the property.

Questions for the asesor fiscal before arras (the reservation deposit contract): under which regime the seller sells, how the land is classified, whether a waiver of the exemption is possible, who accounts for the IVA, what AJD and what deduction apply to my structure. The land topic for an investor is covered in the article on investing in land plots, and DNPI's approach to plot-based projects is on the land strategies page.