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V1534-20 21 May 2020 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · escisión parcial

The special regime for partial demerger may be applied if the segregated assets constitute a line of business

A company inquired whether the segregation of its real estate leasing activity into a new entity could qualify for the special regime for partial demerger. The DGT responds that, for this to occur, the transferred assets must constitute an autonomous economic unit and there must exist a separate organization of material and human resources for each activity prior to the operation.

The question raised

Question posed: 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

To qualify for the special regime for partial demerger, the segregated assets must constitute a line of business, understood as an autonomous economic unit capable of operating by its own means. This requires that there exists a separate organization of material and human resources for each activity within the demerging entity prior to the operation. Furthermore, the operation must not have fraud or tax evasion as its primary objective, but must instead respond to valid economic reasons such as the restructuring or rationalization of activities.

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