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V2587-20 29 July 2020 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · canje de valores

Possibility of applying LIS special regime for share exchange and partial financial spin-off

A consulting company proposes a share exchange to make entity Z its parent, followed by a partial financial spin-off of its holdings. The DGT responds that both transactions may qualify for the LIS special regime provided legal and commercial requirements are met.

The question raised

1) Whether the described operations of exchange of securities and partial financial spin-off could qualify for the special tax regime provided for in Chapter VII of Title VII of Law 27/2014, of November 27, on Corporate Income Tax (LIS).

The DGT's ruling

The exchange of securities may apply the special regime if the beneficiary entity acquires the majority of voting rights and the requirements of Article 80 of the LIS are met. The partial financial spin-off may qualify for the regime if majority holdings are segregated and a line of business or majority holdings remain in the spun-off company. Both operations require that their main purpose is not tax fraud or evasion, based on valid economic reasons. In the event of integration into a new tax group, the rules for the incorporation of eliminations and tax credits of Article 74.3 of the LIS shall apply.

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