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V2697-23 4 October 2023 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · régimen especial de fusiones

Professional association may benefit from tax neutrality in a merger if equivalent results are achieved

A professional association, the sole shareholder of a limited company, has enquired whether it can apply the special merger regime when absorbing said company. The DGT has ruled that this is possible if the operation produces results equivalent to a merger and meets the requirements for dissolution without liquidation.

The question raised

Application of the special regime for mergers, spin-offs, contributions of assets, exchange of securities, and change of registered office of a European Company or a European Cooperative Society from one Member State to another of the European Union as provided in Chapter VII of Title VII of Law 27/2014, of November 27, on Corporate Income Tax.

The DGT's ruling

The operation may qualify for the tax neutrality regime if it produces results equivalent to a merger and complies with Article 76.1.c) of the LIS, with the entirety of the social assets being transferred following the dissolution without liquidation of the commercial entity. In this case, the income shall not be integrated into the transferring entity, and the values and seniority of the assets shall be maintained in the acquiring entity. However, the regime shall not be applicable if the primary objective of the operation is to obtain a tax advantage without valid economic reasons.

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