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V1680-17 29 June 2017 · SG de Impuestos sobre el Consumo Criterion in force
IVA · herencia yacente

Transfer of a business by a dormant estate is not subject to VAT if it constitutes an autonomous economic unit

A query was raised regarding whether the transfer of a business by heirs acting as a dormant estate is subject to VAT. The DGT ruled that the transaction is not subject to the tax if the transferred elements form an autonomous economic unit capable of carrying out a business activity.

The question raised

Taxation of said operation in Value Added Tax.

The DGT's ruling

The transfer of a set of tangible and intangible elements that constitute an autonomous economic unit in the transferor is not subject to VAT. For this condition to be met, the elements must be sufficient to allow the development of a business or professional activity on their own merits. In the case of an unclaimed estate that transfers all elements related to the activity, it is considered an autonomous economic unit.

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