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V0309-19 14 February 2019 · SG de Impuestos sobre el Consumo Criterion in force
IVA · unidad económica autónoma

The transfer of assets by a company in liquidation may be subject to VAT if it does not constitute an independent economic unit at the time of the transfer

A company in insolvency liquidation has enquired whether the sale of its assets as a productive unit is exempt from VAT. The DGT ruled that, as the company is inactive and the assets require repairs to function, an autonomous economic unit is not being transferred, and therefore the transaction is subject to tax.

The question raised

Question raised: Liability for Value Added Tax on the transfer and, where applicable, the applicability of the reverse charge mechanism established in Article 84.One.2.e) of Law 37/1992.

The DGT's ruling

For non-liability due to the transfer of an economic unit, the elements must allow for the conduct of a business activity by their own means at the time of the transfer. If the assets require investments, repairs, or the contribution of external organization to be useful, it is considered a mere transfer of assets subject to VAT. In the case of buildings, the exemption for second deliveries or the reverse charge mechanism may apply if the exemption is waived.

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