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V4011-16 21 September 2016 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · deducción por deterioro

Deduction for share capital difference conditional on accounting recordation

A company asked whether it could amend its 2012 tax return to claim a positive share capital difference from a subsidiary following a capitalisation of credit. The DGT replied that this is not possible because the share value was not recorded in the accounts for 2012.

The question raised

Question raised: Taking into account that the consulting entity's holding in A increased by a certain amount through a resolution of the general assembly of the investee entity on December 7, 2012, a capital increase carried out through the capitalization of credits, although, by error, this was not reflected accounting-wise by the consulting entity until January 2013, the consulting entity considers whether it is possible to tax-deduct the positive difference between the value of the equity of A at the beginning and at the close of the 2012 fiscal year with the limit of the referred increase in value of said financial investment during the referred year, by submitting a request for rectification of the Corporate Income Tax return for the 2012 tax period.

The DGT's ruling

To apply the deduction provided for in Article 12.3 of the TRLIS, the value of the holding must exceed the value of the equity of the investee entity at the close of the fiscal year. If a capital increase was not recorded accounting-wise in the 2012 fiscal year, tax validity cannot be granted to a value of the holding that has not been accounted for in said period. Therefore, the requirement that the value of the holding exceeds the equity at the close of 2012 is not met.

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