TAXATION OF VIVIENDA VACACIONAL (PRIVATE HOLIDAY RENTAL) PROPERTIES

Given the numerous enquiries and questions received in respect of Decree 113/2015, of May 22, which approved the regulation of holiday homes in the Autonomous Community of the Canary Islands (BOC No. 101 of 05/28/2015), the Canarian Tax Authorities have announced on their website that a vivienda vacacional rental (defined as a temporary holiday let to someone in exchange for money and which has been advertised in tourism-related channels) is an activity subject to, and not exempt from, Canarian Indirect General Tax (IGIC). 

As such, anyone carrying out this activity (the owner or the individuals or legal bodies doing so on behalf of the owner) must comply with the following requirements:

– to register as liable for the tax (modelo 400)

– to issue invoices for each stay

– to pass on or apply IGIC at 7% on the price of the accommodation and specify it in the invoice.

Likewise, they are subject to the obligations of IGIC taxpayers (as per Article 59 of Law 20/1991, of June 7), which include the presentation of quarterly IGIC self-assessments by modelo 420).