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V2538-14 30 September 2014 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · reducción de capital

Excess in the tax treatment of capital reduction and share exchange returns

A sole shareholder of a S.L. asks how to tax the reduction of capital with the return of contributions following a capital increase via share exchange. The DGT explains that the return of contributions reduces the acquisition value, and any excess is taxed according to its origin.

The question raised

Taxation of the operation for Personal Income Tax purposes.

The DGT's ruling

The refund of contributions that does not derive from undistributed profits shall reduce the acquisition value of the shares until its cancellation; if the amount exceeds said value, the excess shall be taxed as income from movable capital without the right to an exemption. Conversely, the portion corresponding to undistributed profits shall be taxed in full as income from movable capital, subject to withholding and payment on account, but with the right to the 1,500 euro exemption. In cases of securities exchange, the securities received shall be valued at the value of those delivered, adjusted by the supplementary cash compensation.

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