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V1043-18 25 April 2018 · SG de Impuestos sobre el Consumo Criterion in force
IVA · régimen especial del criterio de caja

Absorbing entity must follow general accrual basis after merger, unless opting for cash accounting

A company subject to the general VAT scheme absorbs another that used the special cash accounting scheme. The DGT clarifies that the absorbing entity must follow the general accrual rules following the merger, although it may subsequently opt for the cash accounting method.

The question raised

Application of the special cash basis regime by the taxpayer.

The DGT's ruling

In merger operations, the absorbing entity subrogates into the rights and obligations of the absorbed entity. Therefore, following the merger, the taxpayer's operations must be declared under the general accrual basis. However, the absorbing entity may opt for the special cash basis regime once the process is concluded, exercising the option in December through a census declaration and complying with the legal requirements.

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