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V1081-22 17 May 2022 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · escisión total

Total demergers may qualify for special tax regime if LIS requirements are met and valid economic reasons exist

The taxpayer inquired whether a demerger operation could apply the special regime under the Corporate Income Tax Act (LIS) and if its motives were economic. The DGT indicates that, provided legal requirements are met and the allocation of values is proportional, the regime could apply, as long as its primary purpose is not tax evasion or tax advantage.

The question raised

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

In order for a spin-off to qualify for the special regime under Chapter VII of Title VII of the LIS, it must meet the requirements of Article 76.2.1.a) and, if the allocation of values is not proportional, the assets must constitute business lines. The regime shall not apply if the main objective of the operation is tax fraud or evasion, or if it lacks valid economic reasons pursuant to Article 89.2 of the LIS. The reasons for separating assets to facilitate the entry of partners and investment could be considered economically valid, although their classification depends on the facts.

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