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V5052-16 21 November 2016 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · sociedad civil

Civil companies with commercial purposes and fiscal legal personality are subject to Corporate Tax

A civil company enquired whether the subletting of urban properties constitutes a commercial activity that requires it to pay Corporate Tax. The DGT ruled that, as this activity is not excluded from the commercial scope, the entity must be subject to this tax.

The question raised

Whether the subletting of urban properties is considered an activity with a commercial purpose and, if so, whether the consulting entity shall be a taxpayer for Corporate Income Tax in accordance with the provisions of article 7.1.a) of Law 27/2014, of November 27, on Corporate Income Tax.

The DGT's ruling

To be a taxpayer for Corporate Income Tax, a civil society must possess legal personality and a commercial purpose. Legal personality is recognized if the society manifests itself before the Administration through a public deed or a private document with a Tax Identification Number (NIF). Commercial purpose is understood as the performance of production, exchange, or service provision activities that are not excluded, such as the subletting of urban properties.

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