Newly created companies may benefit from a 15% tax rate if there is no transfer of activity

The application of the reduced 15% tax rate for newly created entities is a key tax benefit to encourage economic activity. However, access to it is conditional on the entity not being a continuation of a previous activity or an existing group structure.

What the DGT has ruled

The Dirección General de Tributos (DGT) has clarified the scope of Article 29.1 of Law 27/2014. Entities carrying out economic activities may be taxed at the reduced rate of 15% during the first period with a positive tax base and the following one. However, this benefit is excluded in the following cases:

• When the activity has been transferred by other related persons or entities.
• When the activity was carried out the previous year by a natural person who holds more than a 50% stake in the new entity.
• When the entity is part of a group of companies, as defined by the Commercial Code.

What it means for you

If you are incorporating a company, compliance with these requirements will determine your initial tax burden. The benefit is not automatic for any newly created company; the administration will monitor that the incorporation of a new entity is not used to transfer an existing activity to avoid the general rate of Corporate Income Tax (Impuesto sobre Sociedades).

For natural persons deciding to transition to a corporate model, it is essential to analyze whether the activity they are going to develop was already being carried out individually. If they maintain a stake of more than 50% in the new company, the DGT establishes that they will not be able to access the 15% rate.

What should be done

Before proceeding with the incorporation of the entity or the transfer of assets, it is necessary to perform an analysis of the traceability of the economic activity. It is essential to verify if there is a previous link to the activity or to other entities that could invalidate the right to the reduced rate. Each corporate structure must be evaluated individually to determine its compliance with Corporate Income Tax regulations.