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V3255-15 23 October 2015 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · aportaciones no dinerarias

Special regime for non-monetary contributions may apply if LIS requirements are met and valid economic reasons exist

An individual has enquired whether the contribution of shares from one entity to another can qualify for the special regime for non-monetary contributions and if the underlying reasons are valid. The DGT has ruled that this is possible provided that the requirements regarding shareholding and residence are met, and that the creation of a holding company to facilitate hereditary transfer constitutes a valid economic reason.

The question raised

Question posed: Whether the proposed transaction could qualify for the special tax regime regulated in Chapter VII of Title VII of the Corporate Income Tax Law, and whether the economic reasons can be considered valid for the purposes of applying the aforementioned special regime.

The DGT's ruling

To apply the special regime for non-monetary contributions under Article 87 of the LIS, the beneficiary entity must be resident in Spain or have a permanent establishment, and the contributor must hold at least 5% of its equity following the transaction. In the case of shares, the entity must not be an economic interest group nor have the management of movable or immovable property as its main activity, and the participation must have been held uninterruptedly during the previous year. The regime shall not apply if the main objective of the transaction is tax fraud or evasion, but reasons such as conversion into a holding company to concentrate holdings and facilitate hereditary transmission are considered economically valid.

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