On October 18th, the Royal Decree-Law 18/2022 was published in the official state gazette, approving measures to strengthen the protection of energy consumers and to contribute to the reduction of natural gas consumption via the application of the “Plan + security for your energy (+SE)”, as well as remuneration measures concerning public sector personnel and the protection of prospective agricultural workers affected by the drought.

This Royal Decree-Law introduces the following tax measures for Corporate Income Tax:


Hybrid Asymmetries

Directive (EU) 2016/1164 has incorporated a new provision addressing the new case of inverted hybrid asymmetries.

The current Article 9a of the Directive addresses inverted hybrid asymmetries by obliging the Member States to treat fiscal transparent entities that are considered by the legislation, due to the countries of residence of their majority shareholders, as tax residents to avoid a situation of hybrid mismatch in which certain incomes are not taxed in any country or territory, i.e, they are not taxed either at the headquarters of the entities in the allocation of income or at the headquarters of their shareholders or of the entity paying such income.

To incorporate this mandate into our legislation, amendments have been made to Article 6 and Article 15 bis of the Corporate Income Tax Law, announcing that certain entities in the income attribution regime have now become taxable subjects of corporate tax under certain circumstances.

The amendment affects entities in the income attribution regime in which one or more related entities participate directly or indirectly, on any given day of the year, in the capital, equity, results or voting rights of 50 per cent or more and are resident in countries or territories that qualify the entity under an income attribution scheme as a personal income taxpayer, will be subject to corporate income tax, as a taxpayer, on certain positive income that is attributable to all participants resident in countries or territories that qualify the entity under an income attribution scheme as a personal income taxpayer.

These entities shall be subject to Corporation Tax, as a taxpayer, for the following positive income that corresponds to all shareholders resident in territories that consider the entity as a taxpayer for personal income tax:

  • Income obtained in Spanish territory that is subject to and exempt from taxation under the Income Tax of non-residents.
  • Foreign sources of income that are not subject to or are exempt from taxation by the country or territory of the entity or entities paying such income.

The tax period shall coincide with the calendar year in which the aforementioned income is obtained.

The rest of the income obtained by the entity in attribution of income shall be attributed to the partners, heirs, co-owners or participants and will be taxed under the provisions of the Personal Income Tax Law.

Therefore, the entities that must apply the new section of the provisions shall be obliged to comply with the accounting and registration obligations corresponding to their income, including those that are already subject to the Corporation Tax.

Given the potential impact that these measures could have on income-allocating entities in Spanish territory that give rise to hybrid asymmetries, they should review their position, not only in view of the possible practical implications but also the alternatives and the potentially available deadlines to mitigate them.



Autohors: Rocío Lorenzo, International Tax Manager and Jaime López, International Tax & Transfer Pricing Partner