Through its resolution dated 20th October 2016, the Spanish Central Economic-Administrative Tribunal (TEAC) has considered that merely because a non-resident enterprise owns a real-estate which is leased to their Spanish subsidiary, it cannot be concluded that there is a permanent establishment for VAT purposes if the existence of material and human resources for the performance of a business activity in Spain cannot be proved.
This criterion corresponds to EC-Rule 282/2011 but clearly contradicts the wording of art. 69.3.g) of the VAT Law so that a new pronouncement either from the TEAC or the Tax Office (DGT) itself is to be expected.
