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V1918-14 16 July 2014 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · régimen especial de fusión

Mergers may qualify for special Corporate Tax regime if valid economic reasons exist and tax avoidance is not the purpose

The applicant inquired whether a merger could apply the special tax regime for Corporate Tax and if Article 108 of the Securities Market Law applies. The DGT ruled that a merger may qualify for the special regime provided it meets commercial requirements and has valid economic reasons, and that the anti-avoidance rule of the Securities Market Law does not apply as it is a primary market transaction.

The question raised

1) Whether the described operation may qualify for the special tax regime of Chapter VIII, Title VII of the Recast Text of the Corporate Income Tax Law approved by Royal Legislative Decree 4/2004, of March 5.

The DGT's ruling

To apply the special merger regime of the TRLIS, the operation must be carried out within the commercial sphere pursuant to Law 3/2009 and comply with Article 83.1 of the TRLIS. The regime shall not apply if the primary objective is tax fraud or evasion without valid economic reasons. The existence of negative tax bases does not preclude the regime if activities are maintained and the financial situation is strengthened. Regarding the Securities Market Law, the operation is not subject to its Article 108 because the merger involves the issuance of new securities (primary market) and not a transfer in the secondary market.

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