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V3664-16 5 September 2016 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · prestación de desempleo

Unemployment benefit exemption is not lost when converting a civil society into a commercial company

A query was raised regarding whether converting a private civil society into a company with legal personality violates the requirement to maintain activity for five years after receiving unemployment benefits as a lump sum. The DGT ruled that the conversion does not constitute a breach of the period, provided that the investment is maintained.

The question raised

Whether the maintenance of activity for 5 years, as established in Article 7.n of the Personal Income Tax Law, is deemed breached if a private civil society is transformed into a company with legal personality that will continue with the same economic activity.

The DGT's ruling

The transformation of a civil society into a commercial or labor company does not constitute a breach of the five-year investment maintenance period. This is possible because both entities are included among the entities authorized to apply the exemption. Nevertheless, the maintenance of the investment must be complied with during the established five-year period.

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