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V1529-20 21 May 2020 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · aportación no dineraria

Requirements for non-monetary contributions under LIS special regime and need for valid economic motives

A taxpayer asks whether transferring shares between entities can qualify for the LIS special regime. The DGT states that this is possible if participation and ownership criteria are met and the transaction has valid economic motives, not just tax advantages.

The question raised

1. Whether the operations involving the contribution of holdings set forth in the consultation request may qualify for the special 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

To apply the special regime for non-monetary contributions, the receiving entity must be a resident in Spain and the contributor must maintain a shareholding of at least 5% of the equity. In the case of natural persons, the holdings must represent at least 5% of the equity of an entity that does not manage movable or immovable assets and must have been held uninterruptedly during the previous year. The application of the regime is excluded if the operation has the primary objective of tax fraud or evasion, or if it lacks valid economic reasons.

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