Newly created companies controlled by another company cannot apply the 15% rate

The taxation regime for newly created entities offers a reduced rate of 15% in their first two periods with a positive taxable base. However, the application of this benefit is conditioned on the entity's ownership and control structure.

What the DGT has resolved

The Directorate General of Taxes (DGT) has determined that newly created entities carrying out economic activities cannot benefit from the reduced 15% rate if they are part of a group of companies, in accordance with the provisions of Article 42 of the Commercial Code. In the case analyzed, the consulting entity depended on a holding company that owned 100% of its capital, which implies the existence of control and, consequently, the formation of a commercial group.

Current regulations allow this benefit to encourage the creation of independent companies, but the presence of a group structure automatically excludes this preferential tax treatment.

What it means for you

If your company is newly created but its capital is controlled by another company (such as a holding company), you must expect to pay the general rate of Corporate Tax (Impuesto sobre Sociedades) from its first profitable financial years. The existence of a relationship of dependence or total control by another commercial entity invalidates the possibility of applying the reduced 15% rate, regardless of whether the activity is new.

What is advisable to do

It is necessary to analyze the entity's ownership structure before starting the activity to determine the real tax burden. It is recommended to:

• Verify if the capital structure implies the formation of a group according to the Commercial Code.
• Carry out tax planning that contemplates the general rate of Corporate Tax in the first financial years.
• Evaluate the shareholding composition to understand the impact of the regulations on the new entity's profitability.