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V0233-14 ·31 January 2014 ·consulta-vinculante Medium impact
Tax

Debt forgiveness by shareholders treated as income if it exceeds their effective shareholding

A query was raised regarding whether debt forgiveness by a company's shareholders can be considered entirely as a contribution to equity. The DGT ruled that only the portion proportional to their shareholding constitutes a contribution, whereas any excess is treated as income for the company and a non-deductible expense for the shareholder.

In 6 key points

How it affects those involved

This ruling clarifies the tax treatment of debt forgiveness, distinguishing between equity contributions and taxable income based on the shareholder's actual stake in the company.

Lifecycle

2014-01-31PublishedPublished in the BOE
Official text Based on BOE data (boe.es). Information, not advice.

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This analysis is informational only and does not constitute legal advice or create a client-adviser relationship. BM Consulting.
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