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V2432-23 7 September 2023 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · canje de valores

Possibility of applying the tax neutrality regime in contributions of shares subject to compliance with legal requirements

The DGT states that the special tax neutrality regime applies only if minimum 5% shareholding and valid economic reasons are met, excluding transfers below this threshold.

The question raised

Whether the reasons set forth justify the execution of the projected operations of non-monetary contribution of the entirety of the shares held by the applicants in the various entities exposed to a parent entity (entity A), and whether these are considered valid economic reasons pursuant to the provisions of Article 89.2 of the Corporate Income Tax Law, without having at any time the primary objective of tax fraud or evasion.

The DGT's ruling

In order for non-monetary contributions of shares to qualify for the special tax neutrality regime, the requirements of Article 87 of the LIS must be met, including that the holding represents at least 5% of the entity's equity and is held uninterruptedly during the previous year. If the holding is less than 5%, said regime shall not be applicable. Furthermore, the operation must not have fraud or tax evasion as its main objective, and valid economic reasons must exist.

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