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V1907-24 22 August 2024 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · exención de rentas

6% share transfer in holding company may qualify for LIS art. 21.3 exemption

An entity with 6% of a holding company K's capital questions whether the transfer income may be exempt under LIS art. 21.3. The DGT confirms that, as K is a holding company (over 70% of income from dividends and interest), it is necessary to prove a minimum 5% indirect shareholding in K's subsidiaries with a holding period exceeding one year. If K holds more than 90% in its subsidiaries, the requirement is met indirectly, although the duration of holding is not proven in the query. The exemption applies with a 5% reduction in management expenses.

The question raised

If the consultant were to sell its shares in entity K and generate a capital gain as a result, could it avail itself of the exemption provided for in Article 21 of Law 27/2014, of November 27, on Corporate Income Tax?

The DGT's ruling

The positive income from the transfer of shares shall be exempt if the requirements of a minimum 5% holding and a one-year holding period are met. If the investee entity is a holding company that derives more than 70% of its income from income from other entities, the shareholder must also meet the requirements regarding participation and seniority in the indirect subsidiaries. Furthermore, the exemption shall not apply to the portion of the income that does not correspond to undistributed profits if the entity is considered a patrimonial entity. Finally, the exempt income shall be reduced by 5% for management expenses.

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