Rehabilitation Grants: How Owners' Communities Can Apply

Residential rehabilitation grant programmes have put substantial amounts on the table — for significant energy-efficiency works, they can cover a very large share of the cost. The obstacle is rarely technical: it is procedural.

What these grants cover

The core of these programmes is improving the building's energy efficiency: facade and roof insulation, replacement of windows and doors, more efficient thermal installations, and self-consumption (solar) systems. The level of the grant is graded according to the non-renewable primary energy saving that is certified, measured through the energy performance certificate issued before and after the works.

Complementary works are usually accepted alongside the main action — accessibility improvements, asbestos removal, digitalisation — provided they are carried out as part of the same project.

The majorities required

Spain's Horizontal Property Act (Ley de Propiedad Horizontal, LPH) makes these agreements easier to reach, but it is worth being precise about which regime applies in each case:

• Mandatory accessibility works and necessary conservation works do not require a vote at all: they are compulsory.
• Energy-efficiency works and works making use of renewable energy benefit from a simple-majority regime — a majority of owners who also represent a majority of the participation quotas.
• The application for financing linked to those works follows the same majority regime as the works it finances.

An agreement wrongly recorded in the minutes — logged as requiring unanimity when a simple majority was enough, or the other way round — is a classic source of later challenge by a dissenting owner.

The correct order of procedures

1. Technical inspection and diagnosis. Without a valid periodic building inspection (ITE) or building assessment report (IEE), many calls for applications will not even admit the request.
2. Project and initial energy performance certificate. This sets out the projected saving, on which the grant percentage depends.
3. General meeting and resolution. With the special levy (derrama) approved, a payment schedule agreed, and an express appointment of who signs on the community's behalf.
4. Application. Filed with the community's tax ID number (NIF), a certified copy of the resolution, and complete technical documentation.
5. Execution and justification. Invoices, proof of payment through traceable means, and the final energy performance certificate.

The costliest mistake is starting the works before the date the call for applications sets as the eligible start date: spending incurred earlier simply does not count.

Tax effects for owners

Amounts paid for energy-efficiency improvement works have generally given rise to deductions in personal income tax (IRPF), at different percentages depending on the certified saving and on whether the works affect an individual dwelling or the building as a whole. The deduction requires payment through traceable means — never cash — and an energy performance certificate issued within the required deadline.

The grant received by the community, in turn, is treated as a capital gain attributable to each owner, except in the cases of exemption provided for certain rehabilitation grants. It is worth anticipating this effect before the general meeting, since it affects how attractive the operation really is.

Mistakes that disqualify applications

• A community without a tax ID number (NIF), or with outdated details in the Tax Agency's (AEAT) register.
• Minutes that do not precisely identify the approved works or the amount.
• Cash payments split into instalments, which break the traceability the programme requires.
• A final energy performance certificate issued by a different technician, with no explanation for the change.
• Filing on the very last day: processing platforms become overloaded and large document uploads fail.

A well-run community arrives at the call for applications with its technical documentation already prepared. That, almost always, is what separates the communities that secure the grant from those left at the door.

Who manages the grants in the Canary Islands

State rehabilitation programmes are managed in the archipelago through the regional authority responsible for housing, which publishes its own calls for applications, with deadlines, requirements, and forms that differ from those of other regions.

It is worth bearing this in mind for two reasons. First, the deadlines for the Canary Islands' call for applications do not match the state-level deadlines reported in the press. Second, the archipelago's climate changes how the energy saving is calculated: here the emphasis falls on solar protection, ventilation, and the building envelope's resistance to heat, rather than on heating — and the energy performance certificate needs to reflect that so the certified improvement is a real one.

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Notice: this article is for general information purposes and reflects the law in force on its publication date. It is not legal or tax advice for any specific case. Before making any decision, consult a professional.