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V1695-18 14 June 2018 · SG de Impuestos Patrimoniales, Tasas y Precios Públicos Criterion in force
IP · exención

Wealth Tax exemption maintained despite income from movable capital

A query was raised regarding whether the exemption for holdings in entities is lost if income from movable capital exceeds remuneration for management functions. The DGT ruled that capital income is not taken into account when meeting the requirement for majority remuneration.

The question raised

Maintenance of the right to the exemption in Wealth Tax, specifically in the event that income from movable capital were, in a given year, higher than the remuneration for the performance of management functions.

The DGT's ruling

To access the exemption, remuneration for management functions must represent more than 50% of business, professional, and personal work income. Letter c) of Article 4.Eight.Two of Law 19/1991 does not include income from movable capital in said calculation. Therefore, there is no incompatibility between receiving capital income and maintaining the exemption, provided that the other requirements are met.

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