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Form 100. 2019 Personal Income Tax return

8.1.1.2. Calculation of the income attributed and payments on account

Calculation of the income attributed

The following rules shall apply to the calculation of the income to be attributed to each of the members, heirs, co-owners or participants:

  1. The income obtained in the tax period must be determined by the company in accordance with the personal income tax rules. however, when all the members of the company in the income allocation regime are taxable persons of the Corporation Tax or payers of Non-Residents Income Tax with permanent establishment, the income attributable to the company will be determined in accordance with the Corporation Tax rules.

  2. The following reductions on the net income expected in Personal Income Tax will not be applicable by the bank when calculating the income obtained:

    • Reduction of 60% on net earnings from real estate in the event of home rentals (art.23.2 Act)

    • Reduction of 30% on net returns on real estate, furniture or economic activities with a generation period of more than two years or obtained in a particularly irregular manner over time (arts.23.3, 26,2, and 32 Act).

    Note:

    These reductions that cannot be applied by the entity to calculate the income obtained, if they can be made by those members who are individuals who pay Personal Income Tax by entering them in the corresponding boxes of the tax return, boxes: 1567.1573, 1574, and in the allocation of economic activities, boxes 1580.1581.1582),

  3. The income statement attributable to members, heirs, joint owners or shareholders, taxpayers for this tax, who are part of an entity in the income allocation regime established abroad, will be determined in accordance with the above rules.

  4. When the entity obtains foreign source income from a country with which Spain has not signed an agreement to avoid double taxation with an information exchange clause, negative incomes shall be counted to the extent that they do not exceed the amount of the positive incomes obtained in the same country or territory and come from the same source. The excess of negative incomes will be counted in the following four years, as the entity obtains positive incomes in the same country or territory and comes from the same source.

  5. The income will be attributed to the partners, heirs, co-owners or shareholders according to the applicable rules or agreements in each case and, if they do not reliably record the tax administration, they will be attributed equally.

Withholdings and payments on account borne by the Company

The income paid to entities in attribution will be subject to withholding or payment on account, in accordance with the rules of this Tax , regardless of whether all or any of its members are a taxpayer for Personal Income Tax, a taxpayer or a taxpayer for Income Tax for Non-Residents. Such withholdings or payments on account shall be deducted from the tax return of each member, in the same proportion as the income is attributed.