Tax Challenges for Family Businesses: How to Ensure Full Access to Benefits?
CIM Tax & Legal in the Media
Redacción CIM Tax & Legal
At CIM Tax & Legal, we regularly encounter family businesses seeking to maximize the tax benefits offered by the law. However, even when these businesses comply with all legal requirements, they often face difficulties when trying to access these advantages.
Emma S. Corretger and Carlos Muñoz, partners at CIM Tax & Legal, address this crucial topic in an article published in Cinco Días. While the issue seems straightforward in theory, it presents numerous challenges in practice.
Current regulations stipulate that, to enjoy tax benefits, the family business must demonstrate that it carries out real and effective economic activity. This implies that its assets must be focused on generating economic profits and not simply on preserving family wealth.
However, the application of the law is not always clear-cut. Tax inspectors and courts often apply a restrictive interpretation, especially concerning the impact of financial assets on the company’s activity.
Recently, the Supreme Court has begun to establish more defined criteria for applying these tax benefits, representing a significant advancement for family businesses. However, doubts and varying interpretations persist, continuing to create uncertainty. The lack of uniformity in interpretative criteria by reviewing bodies causes significant legal uncertainty, affecting the tax planning of these estates.
In the article, Emma and Carlos highlight the importance of annually analyzing the companies' balance sheets to determine which items are considered relevant to the activity and, therefore, what percentage is eligible for tax benefits.
If you want to know more details about this analysis, we invite you to read the full article:
We thank Cinco Días for trusting our professionals and allowing us to share this analysis in their publication, and María Galán for her continued collaboration with the CIM Tax & Legal team.
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