It is one of the most common decisions in a two shareholder company. Equity needs strengthening, or a shareholder loan has been sitting on the balance sheet for years, and only one of them is in a position to put money in. The matter is settled with an entry to the shareholder contributions account and it is assumed that, absent any consideration and any capital increase, no taxable income arises. The ruling of the Tribunal Económico Administrativo Central (the central economic administrative tribunal, Spain's highest administrative body in tax matters) of 17 July 2025, claim 6172/2022, confirms that this reading fails as soon as the contribution ceases to match the shareholder's stake.
Proportionality is what decides the outcome
A contribution made without consideration is, in substance, a gift, and it falls under recognition and measurement rule 18 of the Plan General de Contabilidad (the Spanish general accounting plan), which sets out a general rule and a special one. The special rule, which allows the contribution to be booked straight to equity with no income recognised, is confined to gifts made by a shareholder acting in that capacity.
The Instituto de Contabilidad y Auditoría de Cuentas (the Spanish accounting and audit institute) defined its scope in query 4 of BOICAC 79 and query 2 of BOICAC 83, a position later carried into article 9 of its Resolution of 5 March 2019. A shareholder acts as such only up to the extent of his holding. Beyond that point he is not reinforcing what is his but enriching the other owners, and that portion falls back under the general rule: income for the recipient.
The 2025 ruling
The case decided is instructive because the imbalance came from the minority side. Three shareholders holding 90, 5 and 5 per cent made contributions to the company, and the latter two paid in sums well above their respective stakes. The tax inspectorate assessed the excess and the tribunal upheld that position, relying on a settled line of rulings of the Dirección General de Tributos (the Spanish tax authority's directorate general for taxation), among them V3769-15 and V1812-16: contributions exceeding the shareholder's actual holding must be recorded as income of the company.
Applied to a two shareholder company the effect is immediate. Where the holder of 70 per cent pays in one hundred and the other pays in nothing, seventy is equity and thirty is income forming part of the taxable base of the Impuesto sobre Sociedades (Spanish corporate income tax) under article 10.3 of Law 27/2014. The company pays tax on a payment made precisely to strengthen it, and the shareholder obtains no deductible expense in return.
The proper route where a shareholder loan exists
Where what is to be converted is a claim held by the shareholder against the company, an alternative avoids that outcome, because no gift arises at all: the shareholder does not surrender his claim for nothing, he receives shares in exchange. This is the capital increase by set off of claims under article 301 of the Ley de Sociedades de Capital (the Spanish companies act), which in the limited company requires the claims to be fully liquid and enforceable, whereas in the public company it is enough that 25 per cent of them are, provided the remainder falls due within five years.
The formalities are best anticipated. The management body must issue a report on the claims, the identity of the contributors and the amount of the increase, expressly confirming that the figures agree with the company's accounts, and in the public company an auditor's certificate is added. On the indirect tax side the transaction falls within the corporate transactions charge under article 19.1.1 of the consolidated text of the Impuesto sobre Transmisiones Patrimoniales y Actos Jurídicos Documentados (Spanish transfer tax and stamp duty) and is exempt under article 45.I.B).11, so no tax is payable.
The blind spot: the shareholder who stands aside
The increase dilutes whoever does not take part, and that is the point usually left unexamined. The Dirección General de los Registros y del Notariado (the Spanish registries and notaries directorate), in its Resolution of 6 February 2012, held that no pre emption right arises in these increases, not even in the limited company, because article 304 confines that right to increases funded by cash contributions. The same resolution warns that this statutory exclusion may leave the shareholder unprotected where the transaction does not serve the company's interest.
A tax risk is added where the shares are created at nominal value while the real value of the company is higher. The same tribunal, in its ruling of 28 March 2023, claim 6398/2019, characterised the gratuitous waiver of pre emption rights as a transfer for no consideration and quantified it under the rules of the Impuesto sobre Sucesiones y Donaciones (Spanish inheritance and gift tax).
Practical implications and conclusion
Three points govern the decision. Check the actual shareholding before any money moves, since it determines which portion carries a tax cost. Choose the route by reference to the objective: with a properly documented claim, capitalisation under article 301 avoids the income and carries no indirect tax cost; without one, only a contribution proportionate to both holdings preserves neutrality. And value the company whenever the increase will shift the percentages, considering an issue at a premium, which is what prevents the dilution from being read as a gratuitous transfer. The caution matters even more in family holding structures, where a contribution made by a single branch is common and its effect on the split of capital can easily go unnoticed.
What looks on the balance sheet like a simple strengthening of equity ends up as taxable base for the portion exceeding the contributor's stake. The choice of instrument is not a formality: it determines the result.
Lexon advises on corporate taxation and equity restructuring from Palma de Mallorca and Manacor. If you have an outstanding shareholder loan, or an unequal contribution in prospect, we can review how it fits together before it is formalised.
Source: ruling of the Tribunal Económico Administrativo Central of 17 July 2025, claim 6172/2022; recognition and measurement rule 18 of the Plan General de Contabilidad; article 10.3 of Law 27/2014, on Corporate Income Tax; articles 301, 304, 307, 308 and 310 of the consolidated text of the Ley de Sociedades de Capital; and Resolution of the Dirección General de los Registros y del Notariado of 6 February 2012.
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This article is provided for general information purposes only and reflects the administrative interpretation in force at the date of publication. It does not constitute legal or tax advice, nor does it replace the individual analysis of each case.