Contributing shares to a company will generate a capital gain or loss

The incorporation of a company through the delivery of shares is not a tax-neutral operation for the contributor. The Dirección General de Tributos (DGT) has specified the treatment this operation must receive under Personal Income Tax (IRPF).

What the DGT has resolved

The tax administration determines that the non-monetary contribution of shares constitutes a transfer of assets. This implies that a capital gain or loss must be calculated by finding the difference between the acquisition value of the shares and their transfer value.

To determine the transfer value, the DGT indicates that the highest amount among the following three parameters will be applied:

• The nominal value of the shares plus any share premiums.
• The market price of the shares on the day of the contribution.
• The market value of the shares.

The result of this calculation must be included in the savings tax base, unless the operation strictly meets the requirements necessary to apply the special regime provided for in the Corporate Tax Law.

What this means for you

If you are an individual deciding to contribute shares of an entity to a new company, you must be prepared to face a potential tax burden. The valuation of the transfer is not limited to the book value, but is governed by market or trading criteria that may increase the value of the operation.

This scenario can result in a capital gain subject to taxation in the savings tax base. Therefore, the contribution of assets is not simply a movement of ownership, but a taxable event that requires a precise calculation of the entry and exit values.

What is advisable to do

In the face of this type of operation, it is necessary to perform a prior analysis of market and trading values to determine the real tax impact. It is fundamental to verify whether the structure of the operation allows access to the special regime of the Corporate Tax Law, which could mitigate the impact on IRPF. Each asset contribution situation must be assessed individually to ensure compliance with current regulations.