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V1184-20 30 April 2020 · SG de Impuestos sobre el Consumo Criterion in force
IVA · holding mixta

Mixed holdings may deduct VAT on share acquisition and general expenses

A company established to acquire a holding company has queried whether it can deduct VAT on advisory fees and whether, in the event of a merger, it would subrogate into the right to deduction. The DGT ruled that, as a mixed holding, it is entitled to proportional deduction and that the merger could be exempt from VAT.

The question raised

1. Right to deduct advisory expenses for the purchase of shares.

The DGT's ruling

A holding entity involved in the management of its subsidiaries is a mixed holding company and holds the status of a trader. Expenses for the acquisition of shares and general expenses are deductible to the extent that it participates in the management of its subsidiaries. If it does not participate in the management of any, it must apply a reasonable allocation criterion. In the event of a merger constituting a transfer of an autonomous economic unit, the acquirer is subrogated in the right to deduction.

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