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V0841-18 26 March 2018 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · fusión por absorción

Merger by absorption may qualify for special Corporate Tax regime if commercial requirements and valid economic reasons are met

A company has enquired whether its proposed merger by absorption can benefit from the special Corporate Tax regime and if the stated reasons are valid. The DGT has ruled that, provided the transaction meets both commercial and Corporate Tax requirements, the regime may apply as long as its primary purpose is not tax fraud or evasion.

The question raised

Question raised 1) Whether the described transaction may qualify for the tax regime provided for in Chapter VII of Title VII of Law 27/2014, of November 27, on Corporate Income Tax and whether valid economic motives exist.

The DGT's ruling

To apply the special merger regime, the transaction must be carried out within a commercial scope pursuant to Law 3/2009 and comply with Article 76.1 of the LIS. The regime shall not apply if the primary objective is tax advantage, requiring valid economic motives such as the restructuring or rationalization of activities. The proposed motives of organizational optimization, generational succession, and administrative efficiency are considered valid for Article 89.2 of the LIS.

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