8.7.3. Deduction for double taxation

1. Due to international double taxation, due to income obtained and taxed abroad

   When the taxpayer's income includes capital gains or profits obtained and taxed abroad, the lowest of the following amounts will be deducted:

   1. The effective amount paid abroad for a tax of an identical or analogous nature to this tax or to the Non-Resident Income Tax on said income or capital gains.

   2. The result of applying the average effective tax rate to the portion of the taxable base taxed abroad.

   For these purposes, the average effective tax rate will be the result of multiplying by 100 the quotient obtained by dividing the total net tax by the taxable base. To this end, the tax rate corresponding to general income and savings income must be differentiated, as appropriate. The tax rate will be expressed with two decimal places.

   When income is obtained abroad through a permanent establishment, this deduction will be applied, and in no case will the procedure for eliminating double taxation provided for in article 22 of the consolidated text of the Corporate Income Tax Law be applicable.

2. For international double taxation in cases of application of the international tax transparency regime.

   When the imputation of income is applicable under the international tax transparency regime, the tax or levy actually paid abroad due to the distribution of dividends or profit shares will be deductible under this concept.

   The deduction will be applied even when the taxes correspond to tax periods other than the one in which the inclusion was made.

   The deduction may not exceed the full amount that would be payable in Spain for the positive income imputed in the tax base.

3. For double taxation in cases where the imputation regime for income derived from the transfer of image rights applies.

   The taxes that can be deducted for this concept by declarants who have included the income derived from said transfer are the following:

   1. The personal tax paid, in Spain or abroad, by the person or entity that is the first transferee of the image rights in the part that corresponds to the portion of the net income derived from the amount that has been included in the current fiscal year.

   2. The tax or levy actually paid abroad for the distribution of dividends or shares in profits distributed by the first transferee, whether in accordance with an agreement to avoid double taxation or in accordance with the internal legislation of the country or territory in question, in the part that corresponds to the amount included in its tax base by the declarant.

   3. The personal tax of a nature similar to the income tax paid by the natural person who owns the image abroad or in Spain as a taxpayer of the Non-Resident Income Tax that corresponds to the consideration obtained as a result of the first transfer of the image rights to the assignee.

   These deductions will be applied even when the taxes correspond to tax periods other than the one in which the inclusion was made.

1. 8.7.3.1 Completion