Skip to content
Back to index
V2471-20 20 July 2020 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · actividad económica

Economic activity of leasing can be assessed at group level if full-time staff are employed

A holding company asks whether one of its subsidiaries carries out economic activity and whether a absorption merger can qualify for the special regime. The DGT states that economic activity can be assessed at the group level and that an absorption merger may apply for the special regime if valid economic reasons exist.

The question raised

1) Whether it can be considered that company X1 carries out an economic activity under the terms established in article 5 of the LIS.

The DGT's ruling

The concept of economic activity is determined at the mercantile group level, considering all the companies that comprise it. In the leasing of real estate, economic activity exists if at least one person with an employment contract and full-time working hours is utilized, even if they are an employee of the holding company. The merger could qualify for the special regime of the LIS if it is carried out in accordance with mercantile regulations and does not have as its primary objective fraud or tax advantage without valid economic reasons.

Book your free first meeting