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V1082-22 17 May 2022 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · fusión por absorción

Absorption merger may qualify for special tax regime and be exempt from VAT and ITP/AJD

A family group asks whether a real estate entity's absorption merger into another can apply to the special corporate tax regime and if the stated economic reasons are valid. The DGT states that if commercial and fiscal requirements are met, the transaction may qualify for the special regime and be exempt from VAT and ITP/AJD under corporate operations.

The question raised

Whether, for the purposes of taxation under Personal Income Tax and Corporate Income Tax, the aforementioned operation may qualify for the special tax regime regulated 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 valid economic motives for the purposes of the provisions of Article 89.2 of the same legal text.

The DGT's ruling

The merger may qualify for the special regime under the LIS if it is carried out for commercial purposes and complies with Article 76.1.a. The reasons stated could be economically valid, although their validity depends on the assessment of the facts. Regarding VAT, the transfer shall not be subject to tax if the elements constitute an autonomous economic unit. Regarding ITP, the operation is a restructuring not subject to the corporate operations modality and exempt in the other modalities. The IIVTNU shall not accrue if the circumstances of the second additional provision of the LIS are met.

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