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V3869-16 13 September 2016 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · régimen especial de fusiones

Mergers may qualify for special tax regime if carried out under Structural Changes Law and for valid economic reasons

A taxpayer has inquired whether a merger involving the absorption of three entities can qualify for the special tax regime. The DGT states that to qualify, the operation must comply with commercial regulations and be driven by valid economic reasons, warning that the regime will not apply if the sole objective is to utilise tax losses.

The question raised

Question posed: Whether the described merger transactions could benefit from the special 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

To apply the special merger regime, the transaction must be carried out within the commercial sphere pursuant to Law 3/2009 and comply with Article 76.1.c) of the LIS. It is essential that the transaction has valid economic motives, such as the restructuring or rationalization of activities, and that its primary objective is not tax fraud or evasion. If the merger of an entity with securities portfolios has the predominant purpose of taking advantage of tax loss carryforwards, it may not benefit from this regime.

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