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V0041-22 11 January 2022 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
IP · exención

Non-security holdings are included in total assets for Wealth Tax exemption calculations

The taxpayer asks whether, to determine if a holding company is entitled to Wealth Tax exemption, the holdings of the investee company must be included in the calculation of the asset proportion. The DGT clarifies that to qualify for the exemption, if the holdings are not considered securities, they are included in both the numerator and the denominator of the asset proportion.

The question raised

Whether, when calculating the proportion between non-business assets and the total assets of the entity to determine eligibility for the exemption, the interests held in the limited company must be taken into account.

The DGT's ruling

To determine whether an entity carries out an economic activity or manages a patrimony, the portion of non-business assets must be compared with the total assets. If the holding entity's interests in the investee company are not considered securities, they shall be included in both the numerator and the denominator of said proportion. Interests that grant at least 5% of voting rights and are held for the purpose of directing and managing the participation, with the availability of material and human resources, shall not be counted as securities.

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