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V1335-17 31 May 2017 · SG de Impuestos sobre el Consumo Criterion in force
IVA · unidad económica autónoma

Transfer of a portion of real estate does not constitute an autonomous economic unit and is subject to VAT

A company acquired a 43.6% stake in a shopping centre and will terminate the current management contract. The DGT has ruled that, as it is not a majority stake and relies on third-party common services, the transaction is a mere transfer of assets subject to VAT, rather than a transfer of a business unit which would be exempt.

The question raised

Treatment of the operation under Value Added Tax is requested.

The DGT's ruling

The transfer of elements is not a non-taxable operation if it does not constitute an autonomous economic unit capable of carrying out an activity by its own means. In this case, the acquisition of a part of the real estate without majority control and its dependence on common third-party services is considered a mere transfer of assets. Therefore, the operation is subject to VAT, and may be exempt according to the conditions for second and subsequent deliveries of buildings.

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