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V1378-07 26 June 2007 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · régimen especial de fusiones

Fusion regime and tax neutrality possible with valid economic reasons

A company inquired whether a merger between its subsidiaries could qualify for the special tax regime and whether the resulting capital gains would enjoy tax neutrality. The DGT responds that this is possible if the merger meets commercial requirements and has genuine economic objectives, not merely fiscal ones.

The question raised

1. Whether the proposed merger operation is eligible for the special tax regime of chapter VIII of title VII of the consolidated text of the Corporate Income Tax Law. Whether the capital gains that could be generated in the absorption of entity D and in A as a consequence of the same absorption could benefit from the tax neutrality regime.

The DGT's ruling

The operation may qualify for the special regime of the TRLIS if it meets the merger requirements of commercial law. The reasons of infrastructure integration and cost savings are considered economically valid to prevent the application of article 96.2. In the absorbing entity, the income from the transfer shall not be included in the tax base if the acquirer is a resident in Spain. The merger difference shall be deductible under the requirements and limits of article 89.3 of the TRLIS.

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