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V2018-18 5 July 2018 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · sociedad civil

Conversion of a civil society into a limited company is not subject to ITP and AJD tax

A civil society with two partners intends to convert into a limited liability company. The DGT analyses the IRPF taxation based on the civil society's legal personality and determines that the conversion is not subject to ITP and AJD.

The question raised

Taxation in Personal Income Tax and in Transfer Tax and Documented Legal Acts Tax.

The DGT's ruling

In Personal Income Tax, if the civil society has legal personality, the transformation does not generate capital gains or losses for the partners if their participation remains unchanged. If it does not have legal personality, the contribution of assets is governed by Article 37.1.d) of the LIRPF. Regarding Transfer Tax and Stamp Duty, the transformation does not constitute a taxable event as it is expressly excluded as a restructuring operation and the deed is not subject to the gradual fee.

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