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V4749-16 10 November 2016 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · retorno cooperativo

Compensation received by a cooperative is taxable at its registered office if it holds the credit right

A query was raised regarding whether compensation received by a housing cooperative should be taxed first at the entity level or directly at the partner level. The DGT has determined that if the cooperative is the holder of the credit right, it must record the income and pay Corporate Income Tax.

The question raised

Whether the compensation received by the consulting cooperative must be taxed first at the level of the cooperative and subsequently at the level of the cooperative members upon its distribution, or whether it should only be taxed at the level of the cooperative member.

The DGT's ruling

If the cooperative is the claimant and the construction company indemnifies it, the entity must recognize accounting income when the judgment becomes final. This income shall form part of the Corporate Income Tax taxable base. The resulting surplus may be distributed among the members as a cooperative return, subject to the corresponding withholdings except for legal exceptions.

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