Capitalizations of credits and debt forgiveness in the corporate income tax

Abstract

Credit capitalization or debt forgiveness are the two potential alternatives to strengthen the financial situation, balance sheet and solvency of companies. In recent times, companies have made widespread use of these mechanisms, affected by the global economic crisis and uncertainty or by the need to mobilize intra-group credit whose repayment became finally impracticable.

This work aims to carry out a practical analysis, without renouncing legal criticism, of taxation for Corporate Income Tax purposes of the most common cases of both types of corporate transactions, indicating the potential legal insecurities of their taxation.