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V2560-23 26 September 2023 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IVA · comunidad de bienes

Transfer of an interest in a community of property is subject to VAT if it does not constitute an autonomous economic unit

A married couple managing a pharmacy through a community of property sought clarification on whether transferring half of the business to one spouse is subject to VAT and how goodwill is treated for Income Tax purposes. The DGT ruled that the transaction is subject to VAT as it does not constitute an autonomous economic unit and explained the rules for the amortisation of goodwill.

The question raised

1.) Subjectivity of the transaction to Value Added Tax.

The DGT's ruling

The transfer of a co-owner's interest is subject to VAT if the transaction, as a consequence of the dissolution of the community, does not constitute an autonomous economic unit capable of carrying out an activity by its own means. In this case, it is considered a mere transfer of assets subject to the tax. Regarding Personal Income Tax (IRPF), the amortization of goodwill shall be a deductible expense with an annual limit of one twentieth of its amount.

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