A total of 1,756 sicavs (variable capital collective investment companies), with an accumulated equity of 15,761 million euros, have already decided to dissolve or transform into companies, after the tightening of the tax regime which entered into force on January 1, within the law to combat tax fraud published in the BOE on July 10. According to data published this Monday by the National Securities Market Commission (CNMV), these companies that will not be able to continue to enjoy paying taxes on their returns at 1% in corporate tax represent 77% of all those that existed before the entry into force of the standard, and its equity represents 54% of the total.
CNMV data indicates that another 467 entities (20.4% of the total), with a accumulated wealth of 12,665 million euros (43.6%), they do plan to continue as sicavs, since they will comply with the new requirements of the tax law. In addition, there are another 63 companies of this type (3% of those registered), with an accumulated equity of 598 million euros (2% of the total), which have not yet made a decision within the period allowed for it, which covers the entire fiscal year 2022.
anti-fraud measure
Sicavs offer high net worth individuals a way to obtain a very advantageous taxation of 1% in corporate tax (compared to the general rate of 25%), although when the owner withdraws the savings they must pay for it in their personal tax. In exchange for paying a 1% corporate tax, the new tax law requires that each sicav have a minimum of 100 partners and that each of them make a minimum investment of 2,500 euros (12,500 euros in the case of a company ).
With this requirement, the Treasury seeks to put an end to the practice known as ‘mariachis’, which would come to be ‘straw investors’ who joined as participants in the sicav with a tiny investment so that others richer take advantage of the tax benefits associates.
The data provided by the CNMV points in the direction that only 20% of the sicavs of the almost 2,300 registered are in a position to meet the requirement demanded against the practice of ‘mariachis’.
“The data shows that, in general, the entities with the greatest assets have decided to continue as a SICAV to a greater extent than those of smaller size”, concludes the CNMV. Specifically, of the 467 entities that plan to continue as a sicav, 384 continue to be taxed at 1% with 11,925 million euros and 83 remain as a sicav but are taxed at 25%, with 740 million euros of assets. There would also be 19 that would be transformed into free investment companies (SIL), according to the CNMV.
The new law
The new law against tax fraud offers sicavs the possibility of adapting to the new requirements to continue enjoying the reduced rate of 1% or a transitory regime that allows them to be dissolved and liquidated free of tax in exchange for the shareholder reinvesting its assets in certain collective investment institutions.
In practice, this last option means, in general, to stop paying taxes at 1% and start doing so at 25%, in the cases of public limited or limited companies.
Of the 1,756 sicavs that, according to the CNMV, will cease to be so, most of them (1,582, with assets of 12,864 million) will be liquidated definitively. Another 174 will be transformed into companies, with 2,896 million assets.