International tax structuring for companies in Spain

The applicable tax regime primarily depends on the tax residency of the contributing shareholder, whether an individual or a legal entity established in the European Union. Both systems · Spanish and French tax law · may apply simultaneously, depending on the nature and residency of the parties. European law (in particular the 2009/133/EC Mergers Directive, transposed in both States) offers tax neutrality mechanisms that avoid immediate taxation of the capital gain at the time of contribution. Determining which regime applies · deferred taxation under French law, or the neutrality regime under Spanish law · requires a prior analysis under international tax treaties and the domestic law of both States concerned.

The ETVE (Entidad de Tenencia de Valores Extranjeros) is a Spanish tax regime applicable to holding companies that hold interests in foreign entities. Subject to conditions, it allows for an exemption on dividends received from non-resident subsidiaries and on capital gains realised on the disposal of those interests. Eligibility conditions include, in particular, a minimum shareholding threshold (5%, or an acquisition value exceeding €20 million), a minimum one-year holding period, and the subsidiary carrying out a genuine economic activity in its State of residence. Spain also offers other advantages for holding structures: an extensive treaty network (over 90 tax treaties), a tax consolidation regime, and transfer pricing rules aligned with the OECD framework.

Yes. In addition to structuring advice, Jean Michel Nogueroles defends companies and taxpayers subject to a tax audit or reassessment in Spain or France. He handles, in particular, disputes relating to the characterisation of tax residency, challenges to holding structures, transfer pricing within Franco-Spanish groups, and the characterisation of a permanent establishment.