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V0128-24 15 February 2024 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · reducción de capital

Excessive return of capital contributions in capital reductions may be taxed as income from movable capital

A query was raised regarding the tax treatment of a capital reduction in a non-listed company involving the return of contributions to shareholders. The DGT explains how to distinguish between the portion that reduces the acquisition value and the portion taxed as income from movable capital.

The question raised

Tax treatment of said operation in the Personal Income Tax of the partners.

The DGT's ruling

The return of contributions that does not derive from undistributed profits reduces the acquisition value of the shares until their cancellation. If the amount returned exceeds said value, or if there is a positive difference between the proportional equity and the acquisition value, the excess is considered income from movable capital. For its part, the portion of the return corresponding to undistributed profits shall be taxed in its entirety as income from movable capital. The income is attributed to the tax period in which it becomes due.

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