Imagine the case when a company must deliver immovables (orchard plot of land with a summer house on it) in leasing or leaseback to natural persons. For natural persons, this immovable is obviously a dwelling place, being connected to all communal utilities.
For the question ”What is the best way of performing such transactions in terms of calculating and paying VAT?”, Marina Dandara, deputy director of Priminfo-Grup, mentions the following:
“Basing on Art. 103 paragraph (1) p.1) of Tax Code, the sale of the immovable shall be exempt from VAT, provided that according to cadastral data, characteristics and status, the concerned immovable is classified as space with housing destination”.
Also, she declares that since the plot of land as part of the immovable is likewise exempt from VAT, it is good practice to separate its value from the total value of the immovable. Thus, even in the situation when the summer house is not clearly defined as house by cadastral information (at least when it is being sold), the VAT shall not be applied upon the sale value of the plot of land.
Such conclusions are valid at least in present circumstances when the fiscal legislation does not foresee a modality for separating the delivery value when selling inseparable assets, one of which is exempt from VAT.