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Form 100. Personal Income Tax Declaration 2019

9.9.1. Provisions to the reserve for investments in the Canary Islands

Taxpayers who carry out economic activities and determine their net income through the direct estimation regime will have the right to a deduction in the full quota for the net operating income that is allocated to the Reserve for Investments in the Canary Islands, as long as these come from economic activities carried out through establishments located in the Canary Islands.

Deduction amount

The deduction will be calculated by applying the average aggregate tax rate (state and regional) to the annual contributions to the reserve that come from the net operating income for the year.


The deduction for contributions to the Reserve for Investments in the Canary Islands may not exceed 80 percent of the part of the full tax quota that proportionally corresponds to the amount of net operating income that comes from establishments located in the Canary Islands. This limit is calculated and controlled by the program.


  1. The taxpayer must determine the net return from its economic activities using the direct estimation method.

  2. The income must come from economic activities carried out through establishments located in the Canary Islands.

  3. The Investment Reserve must appear in the balance sheets with absolute separation and appropriate title, and will be unavailable as long as the assets in which it has materialized must remain in the company.

  4. The amounts allocated to said Reserve must be materialized, within a maximum period of three years from the date of accrual of the tax corresponding to the year in which it was allocated, in one of the investments provided for in article 27.4 of Law 19/ 1994, of July 6, modifying the economic and fiscal regime of the Canary Islands (BOE of July 7).

  5. When the reserve for investments is materialized in fixed assets, these must remain in operation in the same taxpayer's company for at least five years without being transferred, leased or assigned to third parties for their use. When its useful life is less than said period, this requirement will not be considered non-compliance when another asset is acquired that meets the required requirements and completes said period. When it is materialized in securities, these must remain in the taxpayer's assets for five uninterrupted years.

  6. Taxpayers who dedicate themselves, through economic exploitation, to leasing or assigning fixed assets to third parties for their use may enjoy the investment reserve regime, provided that there is no direct or indirect connection with the lessees or assignees. of said assets nor are they financial leasing operations.

    The deduction for Reserve for Investments in the Canary Islands is incompatible for the same assets and expenses, with the deduction for investments of article 68.2 of the Personal Income Tax Law, with the deductions to encourage the performance of certain regulated activities of the Corporate Tax Law, and with the deduction for investments regulated in article 94 of Law 20/1991, of June 7, modifying the fiscal aspects of the Economic Fiscal Regime of the Canary Islands.

The provision of the reserve for investments prior to the maintenance period of the investment or for investments other than those planned, as well as non-compliance with any other of the established requirements, will give rise to the loss of the deductions made, and the taxpayer will be obliged to add to the state liquid quota and the regional or complementary liquid quota accrued in the year in which the requirements were not met, the amounts improperly deducted, plus the corresponding late payment interest.

Anticipated investments of future endowments

Taxpayers may make advance investments of future contributions to the investment reserve, provided that they meet the remaining requirements set forth therein and the aforementioned provisions are made with a charge to profits obtained in the tax period, or in the three subsequent ones.

The aforementioned materialization and its financing system will be communicated together with the personal income tax return for the tax period in which the advance investments are made.