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V1897-14 15 July 2014 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · escisión total

Special spin-off regime may apply if the operation has valid economic reasons

The applicant asks whether a total spin-off of their assets can qualify for the special regime under Corporate Income Tax. The DGT rules that this is possible provided the operation is carried out in accordance with commercial law and is driven by valid economic reasons rather than solely for tax advantages.

The question raised

Whether the application of the special regime under Chapter VIII of Title VII of the consolidated text of the Corporate Income Tax Law is appropriate for the proposed operation. And whether the alleged motives are considered economically valid for these purposes.

The DGT's ruling

To apply the special spin-off regime, the operation must be carried out within a commercial scope, determining the exchange based on the real value of the assets. As it is a proportional total spin-off, it is not necessary for the segregated assets to constitute business lines. The motives of restructuring, management specialization, and risk separation are considered economically valid. The beneficiary entities subrogate into the tax rights and obligations, with negative tax bases and deductions being attributed according to the assets received.

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