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V2277-22 28 October 2022 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · escisión parcial

Special demerger regime cannot apply if transferred assets do not constitute a business undertaking

The taxpayer inquired whether the segregation of its pig farming activity into a new company could qualify for the special partial demerger regime. The DGT ruled that, as the real estate assets were not transferred and the assets appeared to be isolated elements lacking a prior autonomous organisation, the requirement of a business undertaking was not met.

The DGT's ruling

To apply the special regime for partial demergers, the segregated assets must constitute a line of business, understood as a set of elements capable of functioning by their own means. This requires a differentiated business organization and an autonomous economic exploitation that already existed in the transferring entity. If the transferred elements are merely isolated assets without the necessary structure for autonomous exploitation, the operation cannot benefit from the special regime of the LIS.

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