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V1132-14 22 April 2014 · SG de Tributación de las Operaciones Financieras Criterion in force
IRPF · rendimientos del capital mobiliario

Conversion of subordinated debt generates investment income in the savings tax base

The tax treatment of the conversion of subordinated bonds into shares, following the FROB resolution, has been consulted. The DGT determines that the transaction generates investment income based on the difference between the repurchase price and the acquisition value.

The question raised

Tax treatment of this operation under Personal Income Tax.

The DGT's ruling

The conversion of subordinated obligations generates a return on movable capital determined by the difference between the repurchase price set by the FROB and the acquisition value of the securities. This return constitutes savings income and is attributed to the tax period in which it becomes due, i.e., at the moment of repurchase. If the return is negative, it shall be offset against positive returns on movable capital within the savings base of the same period or the following four years.

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