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V3016-19 28 October 2019 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · fusión por absorción

Merger by absorption may qualify for special Corporate Tax regime if commercial and economic requirements are met

A company sought clarification on whether a merger by absorption could qualify for the special Corporate Tax regime and if its underlying motives were valid. The DGT indicates that if the operation complies with commercial regulations and Article 76.1 of the Corporate Tax Act, it may apply said regime, provided its primary purpose is not tax evasion or obtaining an undue tax advantage.

The question raised

Question posed: Whether the described transaction may 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

To apply the special merger regime, the transaction must be carried out within a commercial scope pursuant to Law 3/2009 and comply with Article 76.1 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. Reasons of centralization, synergies, and capital optimization could be considered valid, although their classification depends on the actual facts of the transaction.

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