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Form 100. 2019 Personal Income Tax return

Depreciation allowances

The amounts posted as depreciation of tangible fixed assets, intangible assets and real estate investments are deductible expenses, corresponding to the effective depreciation of the different elements due to operation, use, enjoyment or obsolescence.

Depreciation is considered effective when it is the result of applying one of the methods provided for in article 12.1.a of the Corporation Tax Act, which are in short the following:

  1. Linear depreciation coefficients that establish from 1 January 2015 the amortisation table set out in article 12.1.a) of the Spanish Corporation Tax Act.

  2. Constant percentage of the outstanding value.

  3. Method of digits.

  4. Plan formulated by the taxpayer and accepted by the Administration.

  5. Justification of the amount by the taxpayer.

The basis for the amortisation is the acquisition price of the element, including any additional expenses that occur until it is put into operation, or due to its production cost, excluding residual value, if applicable.

The depreciation will be made from the putting into operation conditions of the element if it belongs to tangible fixed assets or real estate investments, or from the moment they are in a position to produce income for intangible fixed assets.

Intangible fixed assets are considered assets of defined useful life and are generally amortised, taking into account their useful life. However, when the repayment cannot be reliably estimated, the repayment will be deductible with the maximum annual limit of the twenty-one part of its amount. The goodwill will be redeemed at the maximum annual limit of the twenty-minute part of its amount (5%). 100

The provision in a year of repayments higher than those allowed for tax purposes does not constitute a deductible expense, although the excess may be in subsequent periods.

The capital elements for which, in tax periods beginning before 1 January 2015, a depreciation coefficient was being applied other than that corresponding to them by applying the new amortisation table provided for in article 12,1 of the Spanish Corporation Tax Act, they will be amortized during the periods that will be subtracted until their useful life is complete, in accordance with the table above, on the net tax value of the existing good at the start of the first tax period starting from 1 January 2015.

Special systems

  • Small size companies

  • Financial lease

Used equity elements

In the case of assets of tangible fixed assets and real estate investments that are acquired, the depreciation will be calculated in accordance with the following criteria:

  • If the acquisition value of the used element is taken as the basis of the amortisation, the maximum usable coefficient will be the double of the maximum linear depreciation coefficient set in the repayment table.
  • If the acquisition price or original production cost is taken as a basis for depreciation, the maximum linear depreciation coefficient set in the repayment tables for this element will be applied.
  • If the purchase price or cost of originating production is not known, the taxpayer can determine the price periodically, and once established, it will proceed in accordance with the provisions of the previous letter.

For these purposes, buildings whose age is less than ten years old will not be considered as used equity elements.

Cases of freedom of amortisation

Freedom of amortisation in new elements of fixed tangible assets. Transitional regime for amounts pending application at 31 March 2012 (additional provision of the Personal Income Tax Act and transitional provision of the thirteenth Corporation Tax Act)

Taxpayers who, as of 31 March 2012, had amounts pending application for the following investments that have enjoyed the freedom of amortisation provided for in the additional provision eleven of the revised text of the Spanish Corporation Tax Act:

  • Investments made in the years 2009 and 2010 to which the freedom of amortisation with employment maintenance applies, in addition to the eleventh provision of the revised text of the Spanish Corporation Tax Act, as drafted by Royal Decree-Law 6/2010 of 9 April, on measures to promote economic recovery and employment.
  • Investments made from January 1, 2011 until March 30, 2012, which are subject to the freedom of amortisation without maintenance of employment of the additional provision eleven of the revised text of the Spanish Corporation Tax Act, as provided for in Royal Decree-Law 13/2010, of 3 December, on actions in the tax, labor and liberalizers field to promote investment and job creation.

Taxpayers who, as of 31 March 2012, have not fully paid off the investment made for this concept may continue to apply the amounts that have outstanding in the conditions and with the requirements established by the additional eleventh provision of the revised text of the Spanish Corporation Tax Act, according to the wording given by Royal Decree-Law 6/2010, of 9 April and Royal Decree-Law 13/2010.

The amounts pending amortisation may be applied with the limit of the net positive return on the economic activity to which the equity elements have been affected prior to the deduction of the outstanding amounts and, where applicable, the reduction of 5% for provisions and expenses of difficult justification planned for the simplified direct estimate method. 100

Freedom of amortisation (article 12,3 of the Spanish Corporation Tax Act)

Yes, the following items can be freely amortised:

  • The elements of tangible and intangible fixed assets, excluding buildings, which are used for research and development activities.
  • Buildings can be depreciated on a straight-line basis over a period of 10 years, from when they are put to use for research and development activities.
  • Research and development expenses activated as intangible fixed assets, excluding depreciation of the elements that enjoy freedom of amortisation.
  • The elements of tangible or intangible fixed assets of entities that have the rating of priority associative holdings in accordance with the provisions of Act 19/1995, of 4 July, on the modernisation of agricultural holdings, acquired during the first five years from the date of their recognition as a priority holding.
  • New tangible fixed assets, whose unit value does not exceed 300 euros, up to the limit of 25,000 euros referring to the tax period. If the tax period were less than one year long, the stated limit would be the result of multiplying 25,000 euros by the corresponding proportion between the duration of the tax period with respect to the whole year.