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V3141-15 19 October 2015 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · exención de rentas

Entity may apply exemption for share transfer if minimum capital percentage is met

A private equity entity asks whether it can apply the exemption under Article 21 of the LIS when transferring a 8.37% share without triggering the special valuation restriction. The DGT confirms that the exemption applies as the minimum shareholding threshold is met and the special valuation rule does not apply.

The question raised

Question posed: Whether entity A may benefit, at the time of the transfer of its shareholding in B, from the exemption provided in Article 21 of the Corporate Income Tax Act, without the restriction in paragraph 4, letter a), of the aforementioned article being applicable.

The DGT's ruling

The entity may apply the exemption provided in Article 21 of the Corporate Income Tax Act regarding the income obtained from the transfer of its shareholding in company B. The minimum shareholding requirement is deemed to be met by transferring at least 5% uninterruptedly during the previous year. The special limitation rule in paragraph 4.a) is not applicable because the shareholding meets the percentage requirement and the direct transfer by the contributing entity would also have been entitled to the exemption.

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