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V1508-22 23 June 2022 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · fusión

Mergers may qualify for special Corporate Tax regime if commercial requirements are met and valid economic reasons exist

The taxpayer inquires whether the absorption of one entity by another can qualify for the special merger regime and what constitutes valid economic reasons. The DGT indicates that it must comply with commercial regulations and Article 76.1 of the Corporate Tax Act, and must not have the primary purpose of fraud or tax advantage.

The question raised

Whether the described transaction could qualify for the tax regime provided for in Chapter VII of Title VII of Law 27/2014, of November 2, on Corporate Income Tax, and whether valid economic reasons exist.

The DGT's ruling

To apply the special regime, the transaction must be carried out within the commercial sphere 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 fraud or evasion, or if it lacks valid economic reasons such as the restructuring or rationalization of activities. Reasons of operational rationalization, cost reduction, and improvement of financial management could be considered economically valid, although their final classification depends on the facts.

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