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V1702-14 ·3 July 2014 ·consulta-vinculante Medium impact
Tax

Conversion of subordinated debt into shares generates income from movable capital for Income Tax purposes

A query was made regarding the tax treatment of converting subordinated bonds into shares following a FROB resolution. The DGT ruled that the transaction generates income from movable capital based on the difference between the repurchase price and the acquisition value.

In 6 key points

How it affects those involved

This ruling clarifies that the conversion process is treated as a taxable event for Income Tax, specifically as income from movable capital, affecting how taxpayers account for the difference between the debt's value and the new shares' value.

Lifecycle

2014-07-03PublishedPublished 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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