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Practical Handbook for Companies 2021

Non-application of the special system

Regulation:Article 89.2 LIS

The special regime shall not apply when:

  • The operation carried out has as its main objective the fraud or the tax evasion.

  • The transaction is not carried out for valid economic reasons, such as restructuring or rationalisation of the activities of the entities involved in the transaction, but merely for the purpose of obtaining a tax advantage.

In the event that the tax administration's verification actions determine the total or partial inapplication of the special tax regime by application of the provisions of the previous paragraph, they shall exclusively eliminate the effects of the tax advantage.