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V0852-20 14 April 2020 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · escisión total

The total spin-off of a company may qualify for the special regime if the requirements of the LIS are met and valid economic reasons exist

A holding company inquires whether its total spin-off into two new entities may apply the special regime of Corporate Income Tax. The DGT indicates that, if the operation complies with commercial regulations and maintains the proportionality of the shareholders, it could qualify for the regime, provided that its primary purpose is not tax advantage.

The question raised

Question posed: Whether the described operation may qualify for the tax regime provided for in Chapter VII of Title VII of Law 27/2014, of November 27, on Corporate Income Tax, and whether valid economic reasons exist.

The DGT's ruling

For a total spin-off to qualify for the special regime of Chapter VII of Title VII of the LIS, it must comply with the requirements of Article 76.2.1º a) and, if the proportionality of the shareholders' holdings is maintained, it is not necessary for the assets to constitute business lines. Likewise, pursuant to Article 89.2 of the LIS, the operation must not have fraud or tax evasion as its main objective, and must be based on valid economic reasons. Reasons such as separation of treasury, balance sheet transparency, rationalization of activities, or inheritance planning could be considered valid, although their classification depends on the specific facts.

Apply this to a real case

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