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V1225-18 10 May 2018 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · escisión total

Special spin-off regime cannot be applied if segregated assets do not constitute business lines

A real estate leasing company has enquired whether its non-proportional total spin-off can qualify for the special regime under Corporate Income Tax. The DGT has ruled that this is not possible because the entity lacks a differentiated organisation that allows for the identification of autonomous business lines.

The question raised

Whether the described operation can 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 non-proportional total spin-off to qualify for the special regime, the acquired assets must constitute business lines. A business line is a set of assets that form an autonomous economic unit capable of operating by its own means. In this case, as there is no differentiated management and organization that allows for the development of separate activities, the operation does not meet the requirements of Article 76.2.2 of the LIS.

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