Capital gains realised from re-evaluation of an entity due to change in its legal form are subject to a capital gains tax of 22.5%. The tax can be deferred until the actual disposal of the shares and/or the assets, provided the following:

• Assets and liabilities to be stated at their book value, depreciation to be calculated, reserves and allowances to be carried over, based on the same principles applied before the change of legal form.
• Company to maintain the shares or quotas for three consecutive years after the legal form change.
• The following is considered a change of legal form of an entity:
  • Merger of two or more resident companies;
  • Demerger of a resident company into two or more companies;
  • Transforming a partnership into a corporation or, transforming a corporation into another one;
  • Transformation of a legal entity into a corporation.

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