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V0205-20 31 January 2020 · SG de Impuestos sobre el Consumo Criterion in force
IVA · unidad económica autónoma

Transfer of a livestock farm may be exempt from VAT if it constitutes an autonomous economic unit

An unclaimed estate has requested clarification on whether the transfer of a livestock farm (including tractor, livestock, and single payment rights) and the leasing of the land and premises are subject to VAT. The DGT indicates that the transaction will not be subject to VAT if the transferred elements form an autonomous economic unit capable of carrying out the activity on its own.

The question raised

Subjectivity to Value Added Tax of said transfer.

The DGT's ruling

The transfer of elements constituting an autonomous economic unit capable of carrying out a business or professional activity by its own means shall not be subject to VAT pursuant to Article 7.1 of Law 37/1992. The fact that the estates and the warehouse are transferred under lease does not prevent the application of this non-subjectivity. If an organizational structure of production factors that allows the unit to be considered autonomous is not transferred, the transfer shall be subject to VAT and each element shall be taxed independently.

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