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V0384-19 21 February 2019 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · escisión parcial

Requirements for applying the special spin-off regime: the necessity for the segregated assets to constitute a line of business

The applicant asks whether the spin-off of a plot of land to another entity can qualify for the special Corporate Tax regime. The DGT rules that this is not possible because the segregated element does not constitute a line of business with its own material and human resources.

The question raised

Whether the proposed reorganization operation is subject to the special tax regime set forth in Chapter VII of Title VII of the LIS.

The DGT's ruling

To apply the special spin-off regime, the segregated assets must constitute an autonomous economic unit that allows for the development of an economic activity. This requires the existence of a differentiated organization of material and human resources for each activity within the demerged entity prior to the operation. In this case, the segregation of a plot of land does not meet the requirement of being a line of business pursuant to Article 76.4 of the LIS.

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