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V3066-16 1 July 2016 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · redomiciliación

Foreign company redomiciliation does not generate income or capital gains

A Spanish resident enquires whether transferring the fiscal residence and registered office of three foreign companies to Spain and then merging them with a Spanish company triggers taxation. The DGT responds that moving the fiscal residence does not generate income under the Personal Income Tax (IRPF) or the Non-Resident Income Tax (IRNR), and that no capital gain arises for the shareholder if the legal personality remains unchanged.

The question raised

Whether the redomiciliation of companies A, B, and C entails any taxable income in Spain under Corporate Income Tax, Personal Income Tax, Non-Resident Income Tax, or Transfer Tax and Documented Legal Acts Tax.

The DGT's ruling

The transfer of domicile and effective management seat to Spain grants tax residence without generating income in the tax base of Corporate Income Tax or Non-Resident Income Tax. For the natural person shareholder, the transfer of the company does not entail capital gains or losses. A subsequent merger may qualify for the special regime of the Corporate Income Tax Act if valid economic reasons exist. In Transfer Tax and Stamp Duty, the transfer of non-EU companies is subject but exempt.

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