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V5399-16 21 December 2016 · SG de Impuestos sobre las Personas Jurídicas Criterion in force
IS · fusión por absorción

Mergers between companies held by the same shareholder may qualify for special tax neutrality regimes

A holding company proposes a restructuring through mergers by absorption to streamline its corporate structure. The DGT has ruled that these operations may qualify for the special Corporate Tax regime and VAT exemption, provided the requirements of economic unity and valid economic reasons are met.

The question raised

1. Confirmation that the merger operations, as described, would objectively qualify within the special regime provided for in Chapter VII of Title VII of Law 27/2014, of November 27, on Corporate Income Tax.

The DGT's ruling

Mergers between companies wholly owned by the same shareholder may apply the special regime of the LIS even if there is no attribution of shares or capital increase, provided that the commercial requirements are met. Reasons of rationalization and cost savings are considered valid economic motives. For VAT purposes, the transfer shall not be subject to tax if an autonomous economic unit is transferred. For ITPAJD, restructuring operations are not subject to the corporate operations modality and are exempt in the other modalities.

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