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V0039-19 4 January 2019 · SG de Impuestos sobre el Consumo Criterion in force
IVA · régimen especial de grupo de entidades

Special group of entities regime cannot be applied if the dominant entity is not established in Spain

A query was raised regarding whether two Spanish entities, both 100% owned by the same French entity, could benefit from the VAT group of entities regime. The Directorate General for Taxes (DGT) ruled that the regulations do not provide for this regime for entities whose parent company is not established within the tax territory.

The question raised

Whether the two entities established in the tax territory may opt for the Special Tax Group Regime.

The DGT's ruling

The special tax group regime requires the existence of a dominant entity and its dependent entities, all of which must have registered offices or establishments within the tax territory. Current regulations do not provide for two Spanish entities, wholly owned by an entity not established in the territory, to meet the requirements for this regime.

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