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V2009-15 26 June 2015 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · escisión parcial financiera

The special regime for partial financial spin-offs may be applied if mercantile and economic requirements are met

An entity inquired whether its partial financial spin-off operation could qualify for the special regime under the LIS and whether its motives were valid. The DGT determines that, by meeting the requirements of mercantile regulations and having valid economic motives, the operation is eligible for said regime.

The question raised

Question posed: Whether the proposed operation could qualify for the special tax regime regulated in Chapter VII of Title VII of the Corporate Income Tax Law, and whether the economic motives can be considered valid for the purposes of applying the aforementioned special regime.

The DGT's ruling

For a partial financial spin-off to qualify for the special regime, it must comply with the requirements of mercantile regulations, and the assets remaining in the spun-off entity must consist of majority holdings in entities or lines of business. Furthermore, the operation must not have fraud or tax evasion as its primary objective, but must instead respond to valid economic motives such as the restructuring or rationalization of activities. The motives alleged by the taxpayer for its operation are considered economically valid pursuant to Article 89.2 of the LIS.

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