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V2748-14 13 October 2014 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · permuta

Temporal imputation of income may apply to land exchange with deferred payments

A company transferred a property to settle third-party debts in exchange for a credit right with payments spread over ten years. The DGT has ruled that, as the exchange is comparable to a sale with collections extending beyond one year, proportional income imputation may be applied.

The question raised

Whether the rule for the temporal imputation of long-term operations, provided for in Article 19.4 of the consolidated text of the Corporate Income Tax Law, is applicable, and whether it may impute the capital gain accrued in the transfer of the property, proportionally, in the tax periods in which the corresponding payments are made by its partners.

The DGT's ruling

The transfer of the property through exchange is considered to have occurred at the time of the execution of the deed. As the exchange is assimilated to a sale operation and the consideration exceeds one year, the entity may apply the criterion of proportional income imputation based on collections pursuant to Article 19.4 of the TRLIS. Notwithstanding, the entity must include in its 2012 tax base the difference between the normal market value of the credit right and the book value of the portion of the property transferred.

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