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V3549-15 17 November 2015 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · actividad económica

Property leasing may constitute an economic activity even when management is outsourced to third parties

A company sought clarification on whether its property leasing activities qualified as an economic activity for Corporate Tax purposes. The Directorate General for Taxes (DGT) ruled that the requirement for an economic activity is met even if management is outsourced to specialised firms instead of employing in-house staff.

The question raised

Whether the real estate leasing activity carried out with the aforementioned means can be classified as an economic activity for the purposes of Corporate Income Tax.

The DGT's ruling

For the leasing of real estate to constitute an economic activity, the LIS requires the use of at least one employee under a labor contract working full-time. However, if the management of the real estate is subcontracted to third-party entities professionally dedicated to such tasks, the requirements of Article 5.1 of the LIS shall be deemed fulfilled. This allows the entity to carry out an economic activity even when the human and material resources are subcontracted.

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