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V0493-18 22 February 2018 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · escisión parcial

Special spin-off regime inapplicable if the segregated activity does not constitute an autonomous branch of activity

A company consulted whether its partial spin-off and share exchange operation could qualify for the special Corporate Tax regime. The DGT ruled that the spin-off does not qualify for the special regime because the leasing activity did not constitute a branch of activity with its own organisation prior to the operation, although the share exchange itself might qualify.

The question raised

Question posed 1. Whether the proposed operations may qualify for the special regime under Chapter VII of Title VII of the LIS.

The DGT's ruling

In order for a partial spin-off to benefit from the special regime, the segregated assets must constitute a line of business, understood as an economic unit capable of operating by its own means with a distinct business organization. In this case, as there was no separate organization or employees exclusive to the real estate activity prior to the restructuring, this requirement is not met. However, the exchange of shares may apply the special regime if the requirements regarding the majority of voting rights and valid economic reasons are fulfilled.

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