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V2086-19 8 August 2019 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · fusión por absorción

Mergers between companies may qualify for special regime if carried out for valid economic reasons

A query was raised regarding whether a merger by absorption can qualify for the European Company special regime. The DGT indicates that for this to apply, the operation must comply with the Structural Changes Act and Article 76.1 of the Corporate Income Tax Act, and must not have fraud or tax advantage as its primary purpose.

The question raised

Possibility that the projected transaction 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.

The DGT's ruling

To apply the special regime under Chapter VII of Title VII of the LIS, the transaction must be carried out within the commercial sphere pursuant to Law 3/2009 and comply with Article 76.1 of the LIS. Likewise, pursuant to Article 89.2 of the LIS, it 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. The reasons alleged by the taxpayer could be valid, but their classification depends on the actual facts and circumstances of the transaction.

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