Taxation of SICAVs in Spain

economic-dictionary

The term SICAV is known as a synonym for tax facilities, since it has a special tax regime in Spain (each country has different conditions).

Said regime is conditioned on the number of shareholders being equal to or greater than 100. In most cases, the figure of mariachis who are natural persons normally of the bank itself (for example employees) to complete the aforementioned sum.

Taxation of SICAVs

Regarding the tax conditions of the SICAVs, the following stand out:

  • The tax rate of the SICAV in Corporation Tax is 1%. Of course, when the shares are settled, you have to pay the general rates for profits or capital gains. In that line there is no fiscal difference whatsoever.
  • Dividends distributed do not entitle the recipient to any deduction for double taxation.
  • The constitution, capital increase, merger or spin-off of these companies enjoy exemption in the modality of corporate operations from the Tax on Patrimonial Transmissions and Documented Legal Acts.
  • The capital gains derived from the transmission or reimbursement of shares or participations of IIC (collective investment institutions) for individuals will be integrated into the tax base of savings. At the time of transfer of shares, the selling shareholder himself must pay taxes on the performance of current movable capital for the capital gain obtained.

SICAVs have had a great expansion in recent years, mainly because they are very useful instruments for important family assets that wish to take advantage of a more advantageous tax system, flexibility in decision-making and a select commercial and management service. .

As we said, it requires a minimum of 100 shareholders, but it does not prevent 95% of the capital from being in the hands of 4 or 5 shareholders (for example, the family group that created the SICAV), with the rest of the partners having the remaining 5%, complying in this way, a merely complementary function and of legal compliance, although benefiting from the same profitability as the main shareholders.

SICAVs can be an investment instrument that offers the best equity solution:

  • Good financial-fiscal profitability.
  • Flexibility.
  • Liquidity.
  • Transparency and supervision by the CNMV.
  • Control.

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