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V1765-19 ·10 July 2019 ·consulta-vinculante Medium impact
Tax

Capitalisation reserve reduction may be applied to only part of the increase in equity

A taxpayer inquired whether the 10% capitalisation reserve reduction could be applied to only a portion of their increase in equity, with the remainder distributed as dividends. The Directorate-General for Taxes (DGT) ruled that the regulations do not prevent applying the reduction to an amount lower than the total calculated increase.

In 5 key points

How it affects those involved

This ruling provides flexibility for companies to optimise their tax position by selectively applying the capitalisation reserve reduction while still allowing for dividend distributions from the remaining equity increase.

Lifecycle

2019-07-10PublishedPublished 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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