Contrary to the criteria previously maintained by some regional economic-administrative courts and the DGT, it is now concluded that, if contributions to equity are not taken into account when computing the increase in equity that gives the right to apply the incentive or to analyze whether the maintenance requirement is met, the same treatment should be given to capital returns and similar distributions to shareholders.

Law 27/2014, of November 27, on Corporate Income Tax (LIS) introduced in its article 25, as a new incentive, the capitalization reserve. Briefly, the rule allows reducing the tax base by 10% of the increase in equity for the tax period (calculated according to the method established in the rule itself), subject to the condition that the referred increase is maintained for a period of five years.

The wording of the rule raises numerous doubts, which may have motivated that, in practice, this incentive (which generates a permanent adjustment), has not been generally used; to which has probably been added the fact that the DGT itself has modified its criteria on some aspects in various resolutions and the also divergent criteria on various issues in the economic-administrative courts.

For example, in relation to the computation of the increase in equity, in its resolution V1836-18, the DGT established that the increase in equity in consolidated groups should be made taking into account the sum of the equity of the entities that are part of the group, as well as the eliminations and incorporations of results for internal operations, as opposed to what it had previously held in its resolutions V4962-16 and V0134-17, in which it concluded that for said calculation, eliminations or incorporations of any kind should not be made.

In any case, it seems that one of the requirements that raises the most doubts is the one related to the requirement to maintain the increase in equity for a period of five years. Among other issues, the question arises as to whether capital reductions or returns of other contributions (or share premiums) to shareholders inevitably imply a decrease in equity and, consequently, a breach of the maintenance requirement.

In various resolutions of economic-administrative courts (for all, the resolution of April 28, 2023 of the Regional Economic Administrative Court of Castilla y León, in the appeal 47/01959/2022), it has been concluded that this type of operation implies a breach of the aforementioned requirement, as the DGT had also concluded in its resolution V4962-16. Specifically, in defense of this conclusion, it has been argued that the discussion is reduced to the fact that “the maintenance requirement refers to the increase in equity and not to each of the equity items that have been increased”.

Notwithstanding the foregoing, in its recent resolution of March 7, 2024 (V0327-24), the DGT modifies this conclusion and points out that, if to determine the increase in equity and compliance with the requirement to maintain said increase, the rule establishes (section 2 of article 25) that, among other items, contributions from shareholders will not be computed, then, based on a systematic interpretation of the rule, the capital reduction with return of contributions to shareholders should not be computed either to determine compliance with the maintenance requirement.

This new criterion is of great interest to shareholders of entities that have applied this benefit of the capitalization reserve, since it allows anticipating capital returns, contributions to equity or share premiums, without this implying a breach of the maintenance requirement. All of this will be useful for the tax campaign that begins shortly, and it may also be advisable to review the declarations of previous years in which the criterion that seems, for the moment, outdated has been applied.


César Herreras Hernández