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V4855-16 11 November 2016 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · fusión

Mergers may qualify for special tax regime if commercial requirements and valid economic reasons are met

A taxpayer queried whether a merger of dental clinics could qualify for the special Corporate Income Tax regime. The DGT indicates that, provided commercial regulations and Article 76.1.a) of the LIS are satisfied, the operation may qualify for the regime as long as its primary purpose is not tax evasion or obtaining an unfair tax advantage.

The question raised

Question raised: 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.

The DGT's ruling

To apply the special regime, the transaction must comply with the requirements of Article 76.1.a) of the LIS and the commercial regulations of Law 3/2009. The regime shall not apply if the primary objective is tax fraud or evasion, or if it lacks valid economic reasons pursuant to Article 89.2 of the LIS. Reasons such as restructuring, rationalization of activities, cost savings, and unification of structures may be considered valid. The existence of pending tax loss carryforwards does not in itself invalidate the application of the regime if the entities are operational.

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