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V0504-20 ·27 February 2020 ·consulta-vinculante Medium impact
Tax

Mergers and demergers may qualify for special tax regime if valid economic reasons exist

A query was raised regarding whether a merger by absorption followed by a total demerger can qualify for the special Corporate Income Tax regime. The Directorate General for Taxes (DGT) indicates this is possible provided the requirements of the Corporate Income Tax Act and the Structural Changes Act are met, and the transaction is driven by valid economic reasons rather than being solely for tax purposes.

In 6 key points

How it affects those involved

Companies undertaking structural reorganisations must ensure that such operations are supported by genuine economic substance to benefit from the special tax regime and avoid being classified as purely tax-driven transactions.

Lifecycle

2020-02-27PublishedPublished 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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