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Form 100. 2020 Personal Income Tax Return Declaration

7.4.4.12.1 Gross income and amortization

Gross income

By placing yourself in the box that corresponds to the crop, the type of livestock, the characteristics of the forestry activity or the service in question, the income from each of the products obtained (or services provided) in the development of the activity will be entered through a data capture window.

Delivery of products or works, services or ancillary activities

In agricultural activities, the distinction shown on the screen between income from crops on own land and from rented land must be taken into account.

When it is not possible to delimit said income, it will be prorated based on the percentage that the leased land dedicated to each crop represents with respect to the total surface area, owned or leased, dedicated to that crop.

For each type of product, and depending on whether the income comes from crops on own land or/and on rented land, or from the type of livestock farm, the following data must be defined based on the net income, provided that there is a right to the corresponding corrective indices:

  1. Portion of the resulting net income that comes from organic farming, if any.

  2. Portion of the net yield resulting from irrigated land that uses electric power.

  3. Part of the resulting net income comes from both circumstances, from organic farming and at the same time uses electricity for irrigation.

Transformation, processing or manufacturing activities

In the case of activities in which natural products are subjected to transformation, processing or manufacturing processes, the value, at market price, of the natural products incorporated into the process during the year shall be indicated, as well as that of those incorporated before January 1, 1998, when the product obtained has been transferred in the year.

Self-consumption, subsidies and compensations

To determine the total volume of income for each type of product (or service), self-consumption will be included, as well as current and capital subsidies (in the part attributable to the financial year) and compensation received for damages suffered by the farm's products.

The income obtained from these concepts will be attributed to the products to which the subsidies or compensations are linked.

In the event that a specific link cannot be established with a particular product, because it was granted in relation to the entire activity carried out, its amount will be distributed proportionally between each of the products, applying the following formula:

Subsidy (Income from product "X" / Total volume of income) = Attributable portion of product "X"

Allocation of subsidies

  • Capital subsidies: These are granted to support the establishment of the activity or the realization of investments in fixed assets and will be recorded as income in proportion to the depreciation experienced in the year (amortization) by the assets financed with said subsidies.

    In the case of non-depreciable assets, the subsidy will be charged to the result of the year in which the sale or write-off of the assets in the inventory occurs, with a 30% reduction applied in the box, since they are considered by regulation to be income obtained in a notoriously irregular manner over time.

  • Farm subsidies: These are generally granted to ensure a minimum profitability or to offset losses incurred in the activity and will be fully recorded as income in the period in which they accrue.

Amortization

In order to correctly apply the corrective indices on the previous net performance corresponding to each type of operation, for the keys of activity "1. Agricultural and livestock farming likely to be included in the AG RE and VAT P. " , "3. Independent livestock farming" and "7. Benefits corresponding to the transferor in agricultural activities under a sharecropping regime" , the deductible amounts in the fiscal year as amortization must be differentiated through a data capture window, according to the part that is reasonably attributed to the different crops and farms (or services provided), according to the following detail:

  1. Elements used in agricultural activities: The amount of depreciation of fixed assets linked to agricultural activities carried out by the taxpayer will be indicated, distinguishing, in turn, the part corresponding to crops on own land and on leased land.

  2. Elements used in livestock activities: The amount of the depreciation of the fixed assets linked to the livestock farms developed by the taxpayer will be indicated, distinguishing, in turn, the part that corresponds to intensive farms of beef pigs and poultry farming from the rest of the livestock farms that, where applicable, are carried out.

  3. Elements used in accessory works and services: The amount of depreciation of fixed assets linked to the accessory work and services provided by the farmer or rancher will be indicated.

Depreciation is not carried out in forestry activities.