Skip to content
V1552-20 ·22 May 2020 ·consulta-vinculante Medium impact
Tax

Forgiveness of a loan between two companies has no impact on the personal income tax of its shareholders

A shareholder who controls two companies inquires about the taxation of a transaction involving the sale of shares from one company to another, followed by the subsequent forgiveness of the resulting debt. The Directorate General for Taxes (DGT) rules that the forgiveness of a loan between companies does not trigger any tax effects for individual shareholders under Personal Income Tax (IRPF).

In 6 key points

How it affects those involved

This ruling clarifies that debt forgiveness occurring at a corporate level does not constitute taxable income for individual shareholders, provided the transaction is strictly between the legal entities.

Lifecycle

2020-05-22PublishedPublished in the BOE
Official text Based on BOE data (boe.es). Information, not advice.

Does this provision affect you?

The tax team reviews your specific situation.

Talk to the tax team
This analysis is informational only and does not constitute legal advice or create a client-adviser relationship. BM Consulting.
Email
Contact