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V2672-20 24 August 2020 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · canje de valores

Share exchange and merger may qualify for special regime if legal and economic conditions met

An entity asks whether a share exchange prior to a merger of two family companies can apply to the special tax regime. The DGT states that this is possible provided voting majority, residency requirements are met and the transaction has valid economic motives.

The question raised

Whether the described operations 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.

The DGT's ruling

The exchange of securities may apply the special regime if the acquiring entity obtains the majority of voting rights and the residency and tax valuation requirements are met. The merger by absorption may qualify for the regime if it is carried out for commercial purposes and complies with Article 76.1 of the LIS. The special regime shall not apply if the primary objective is tax fraud or evasion, or if there are no valid economic reasons for the operation.

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