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V3786-15 ·30 November 2015 ·consulta-vinculante Medium impact
Tax

Impairment loss on a loan to a related party is deductible if the liquidation phase of insolvency proceedings has commenced

A company sought clarification on when it could deduct as an expense the final loss from a loan granted to a related party that entered insolvency proceedings. The DGT ruled that, because the entities are related, deductibility requires the debtor to be in insolvency proceedings and for the liquidation phase to have officially commenced.

In 6 key points

How it affects those involved

This ruling clarifies the strict requirements for tax deductibility of bad debts involving related parties, specifically linking the deduction to the formal commencement of the liquidation stage in insolvency proceedings.

Lifecycle

2015-11-30PublishedPublished 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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