Service charges now exclude VAT.

The previous version of the Real Estate Decree stipulated that service charges levied on the letting of residential properties were subject to the VAT policy applicable to letting. When commercial property was let, the service charges were usually stated with a VAT specification. This was not the case for residential property.

With effect from 1 January 2025, this policy will no longer apply and section 5.3 of the Decree of 12 December 2023, 2023-26908 will apply. With this change, no distinction will be made based on the nature of the rented property (residential or commercial property).

ista will work with you to ensure that this administrative change is implemented in a clear manner and that your service charges are specified excluding VAT on the statement from that moment onwards. This means that from that moment onwards, you will pass on costs to us excluding VAT. We will then ensure that this is incorporated into the cost allocation and that the statement to tenants includes a VAT specification.

Although this new decision will take effect on 1 January 2024, there will be a transition period until 1 January 2025 during which landlords can still apply the old rules. If you have split heating seasons – for example, 1 July 2024 to 30 June 2025 – we will take care of this entirely excluding VAT. A combination of VAT-taxed and VAT-exempt is not possible in this case. Given the transition period, this is in line with the scheme.

ista is part of the NLVVE. As a trade association for sub-metering, we offer our view on matters relating to this new regulation.