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V0328-24 7 March 2024 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · fusión por absorción

Merger by absorption may qualify for tax neutrality if LIS requirements are met

A query was raised regarding whether a merger by absorption of companies A and C by company B could apply the special regime under the LIS and if the underlying reasons are economically valid. The DGT indicates that if the commercial transaction complies with Article 76.1 of the LIS, it could qualify for said regime and its tax neutrality.

The question raised

Whether the described transaction can benefit from the regime provided for in Chapter VII of Title VII of Law 27/2014, of November 27, on Corporate Income Tax, and whether the reasons stated can be considered economically valid.

The DGT's ruling

If the transaction is carried out under Article 76.1 of the LIS, it could benefit from the special regime of Chapter VII of Title VII of the LIS. Under this regime, income would not be integrated into the transferring entities, and the values and seniority of the assets would be maintained in the acquiring entity. However, the regime shall not apply if the primary objective is tax fraud or evasion, or if there are no valid economic reasons.

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