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V0673-22 29 March 2022 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · bases imponibles negativas

Debt write-offs by agreement with creditors are not subject to the loss carry-forward offset limit

A query was raised regarding whether a debt write-off agreed with a single creditor must comply with the limit on offsetting negative tax bases. The Directorate General for Taxes (DGT) ruled that such income is not subject to this limitation.

The question raised

Whether a debt forgiveness resulting from an agreement reached with a single creditor, given the existence of overdue and unpaid debt with only one creditor, is subject to the limit established in Article 26.1 of Law 27/2014, of November 27, on Corporate Income Tax.

The DGT's ruling

Income corresponding to debt forgiveness or extensions resulting from an agreement with the taxpayer's creditors is not subject to the limitation on the compensation of negative tax bases. Likewise, negative tax bases compensated with said income shall not be counted towards the 1 million euro limit.

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