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V2938-15 7 October 2015 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · consolidación fiscal

The loss of dominant status by a non-resident entity does not extinguish the tax consolidation group

A query was raised regarding whether a tax consolidation group is dissolved when its parent company becomes a subsidiary of a non-resident entity. The Directorate-General for Taxes (DGT) ruled that the group is not dissolved and explains the process for integrating new entities and the resulting effects.

The question raised

Question raised: Whether entity A is a dominant entity of the tax consolidation group for the purposes of the provisions of the second paragraph of Article 58.1 of Law 27/2014, of November 27, on Corporate Income Tax, and whether, since January 1, 2015, it is the new dominant entity of the tax group whose dominant entity in 2014 was entity C.

The DGT's ruling

The tax group is not dissolved when the dominant entity loses its status and becomes a subsidiary of a non-resident entity in Spanish territory. Entities that meet the requirements to be subsidiaries shall be integrated into the group in the first tax period beginning on or after January 1, 2015. If the dominant entity of a group acquires the status of a subsidiary and this results in the integration of all its entities into another group, the effects provided for in Article 74.3 of the LIS shall apply.

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