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V1811-20 8 June 2020 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · aportaciones no dinerarias

Non-monetary contributions may apply under LIS special regime if requirements and economic motives are met

Three brothers ask whether transferring their shares in a management company to other Spanish resident companies may qualify for the LIS special regime. The DGT states that this is possible if the shareholding and ownership requirements are met and the transfer has genuine economic motives rather than purely fiscal ones.

The question raised

Question posed: Whether the described transaction 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 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% in the equity following the transaction. In the case of natural persons, the shares must have been held uninterruptedly during the previous year and the entity may not have the management of movable or immovable property as its main activity. Furthermore, the transaction must not have the primary objective of tax fraud or evasion, and valid economic reasons, such as the rationalization of activities, must exist.

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