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V2812-20 17 September 2020 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · entidad parcialmente exenta

Non-profit associations may be partially exempt entities for Corporation Tax

A non-profit association has requested clarification regarding its tax regime for Corporation Tax and VAT. The DGT has determined that it is a partially exempt entity for Corporation Tax purposes, although its advisory and service activities may constitute a taxable economic activity.

The question raised

1) Is the regime for partially exempt entities, provided for in Title VII, Chapter XIV, Articles 109 to 111, of Law 27/2014, of November 27, on Corporate Income Tax, applicable?

The DGT's ruling

The entity is considered a partially exempt entity for Corporate Income Tax purposes. The income from its corporate purpose shall not be taxable if it does not constitute an economic activity. However, income from advisory and training services appears to constitute an economic activity, and therefore shall be subject to tax. Regarding VAT, benefits provided to members are exempt if they consist of statutory fees for collective purposes, but not if an independent price is invoiced for individual services.

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