Back to index
V2625-23 28 September 2023 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · escisión parcial financiera

Financial spin-offs and subsequent mergers may qualify for special tax regime if commercial and economic requirements are met

A query was raised regarding whether a partial financial spin-off followed by a reverse merger can qualify for the special Corporate Income Tax regime. The DGT indicates that the spin-off is permissible provided it meets the requirements of the Corporate Income Tax Act and commercial regulations, while the merger's eligibility will depend on compliance with commercial law and the absence of purely tax-driven motives.

The question raised

Question posed: Whether the described operations of financial spin-off and merger by reverse absorption of the entity Newco by the entity E, executed in a single act, could qualify for the tax regime provided for in Chapter VII of Title VII of Law 27/2014, of November 27, on Corporate Income Tax and whether valid economic reasons exist

The DGT's ruling

Financial spin-offs may qualify for the special regime if the segregated assets consist of majority holdings and the demerged entity maintains majority holdings in other entities or a line of business. The merger may apply the special regime if it is carried out for commercial purposes and complies with Article 76.1.a) of the LIS. 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.

Email
Contact