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V2266-18 31 July 2018 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · régimen especial de fusiones

Tax merger benefits may apply if the transaction has valid economic grounds

A query was raised regarding whether a merger transaction can qualify for the special Corporate Tax regime and if the stated motives are valid. The DGT ruled that, provided commercial and tax requirements are met, the transaction may apply said regime as long as its sole purpose is not to obtain a tax advantage.

The question raised

Question posed: Whether the application of the special regime under Chapter VII of Title VII of the Corporate Income Tax Law is appropriate for the proposed merger operation, and whether the alleged reasons are considered economically valid for these purposes.

The DGT's ruling

To benefit from the special merger regime, the operation must comply with Article 76.1.a) of the LIS and the commercial requirements of Law 3/2009. The regime shall not apply if the primary objective is tax fraud or evasion, or if there are no valid economic reasons such as the restructuring or rationalization of activities. The simplification of management and the facilitation of business succession may be considered valid economic reasons.

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