Skip to content
V1572-19 ·25 June 2019 ·consulta-vinculante Medium impact
Tax

Capitalisation reserve reduction cannot be applied if profits are used to offset losses

The taxpayer inquired whether the 10% reduction for an increase in equity could be applied when it is not possible to allocate funds to an unavailable reserve because the profit must be used to offset losses from previous years. The Directorate-General for Taxes (DGT) ruled that this portion of the profit does not count as an increase in equity.

In 6 key points

How it affects those involved

Companies intending to use profits to offset prior losses will be unable to benefit from the 10% tax reduction related to equity increases for that specific amount.

Lifecycle

2019-06-25PublishedPublished 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