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V1755-18 18 June 2018 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IVA · cese de actividad

Sale of stock following cessation of activity remains subject to VAT if effective cessation and liquidation of assets have not occurred

A retiree enquired whether the sale of his timber stock following the cessation of his business activity was subject to VAT. The DGT ruled that business status is maintained until effective cessation and deregistration from the census take place; therefore, the sale of stock remains subject to the tax.

The question raised

1st Subjectivity to VAT of the sale of wood stock.

The DGT's ruling

The loss of status as a businessperson or professional for VAT purposes does not occur until the activity effectively ceases and the deregistration in the census is filed. Even if the Model 036 deregistration form is submitted, if there is no effective cessation, the tax obligation persists. If the transfer of stock forms part of the business assets, it shall be subject to VAT.

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