Newsletter #5

|18/03/2024|

Dear Clients and Friends,

We are in the midst of the high season for closing accounts, when thousands of accountants are working to close the accounts of companies and institutions. 

We would like to point out that there are legal requirements for convening general meetings to approve the accounts and that you should get in touch if you have any doubts about this. 

Good news for all accountants is the order issued by the Secretary of State for Tax Affairs on March 14, 2024, in which the deadline for submitting model 22 was extended. Companies can now submit their Form 22 until July 15, 2024. As usual, we are sharing a number of topics, the documentation for which can be found in the respective annexes below.

Please do not hesitate to get in touch if you need any further clarification.

Sincerely,

#1 - Tax Neutrality 

Demerger-dissolution operations - Tax Authority Binding Information, Case no. 25161Conditions for the application of the tax neutrality regime in cases of demerger and the respective requirements to be met of a substantive nature, as established in article 74 of the CIRC.

#2 - Taxation of sports clubs - Advance payment of installments of an agreement

Binding information from the AT. Case no. 25027 The binding information provides the framework/requirements for: 1) Whether or not the income of sports associations is exempt from corporate income tax; and 2) If not, how the income is taxed in the sphere of sports associations.

#3 - IMI - Change of destination (Construction/Resale)

Binding information from the AT, Case no. 23263Maintenance of the temporary suspension of IMI tax and, consequently, exclusion from IMI additional taxation in the event of the sale of part of the property rights over real estate to an investor for the purpose of entering into a consortium contract, which maintains the same purpose as the real estate.

#4 - Exemption from IMT and IS - Merger of activities

AT Binding Information no. 24574The binding information sets out the framework/requirements for: 1) "Restructuring operations" to benefit from the exemption in article 60(1)(a) and (b) of the EBF; and 2) Merger by incorporation - article 97(1) and (4)(a) of the CSC.

#5 - Exemption from IMT and IS - Demerger of companies

AT Binding Information no. 25911Highlighting the branch of activity as a fundamental element for the qualification of a demerger as a restructuring operation.

#6 - IRC - Municipal Surtax Rates for 2023

Circular Letter No. 20264 of 2024-02-05IRC - Municipal surcharge rates levied on IRC taxable income for the 2023 tax period.

#7 - Donation of shareholdings - Exemption for spouse and descendants

AT Binding Information no. 24101. The binding information provides the framework/requirements for: 1) The concept of transfer, which is also extended to the taxation of the acquisition of shares when the requirements of Article 2(2)(d) of the CIMT are met; 2) The concept of donation; and, 3) Exemption from IS due to the beneficiaries of the transfer - Article 6(e) of the CIS.

#8 - IFRS 16 - Amendment of point 9 of Circular 7/2020

Circular No. 3/2024 of the Tax and Customs AuthorityIncome tax implications of IFRS 16, regarding the depreciation rates to be applied to right-of-use assets, since no depreciation rates are provided for these assets in the tables attached to Regulatory Decree No. 25/2009, of September 14.