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Form 200. Corporate Income Tax Declaration 2018

2.6.2.1 Incentives for small entities (Cap. XI tit. VII LIS)

This field will be marked by those entities that have applied one or more of the tax incentives for small companies contemplated in Chapter XI of Title VII of the Corporate Tax Law.

These entities may apply the tax incentives established in Chapter XI, provided that the amount of their turnover in the immediately preceding tax period is less than 10 million euros.

However, these tax incentives may not be applied in cases where the entity is considered a patrimonial entity in the terms established in article 5.2 of the LIS .

In cases where the immediately preceding tax period has lasted less than a year, or the activity has been carried out for a shorter period, the net amount of the turnover will be increased to the year:

Imp. net business figure immediately preceding tax period x 365 days divided by the number of days in the immediately preceding tax period

These tax incentives may also be applied in the three tax periods immediately following the period in which the aforementioned turnover of 10 million euros is reached, in the following cases:

  • When the entity or group of entities have met the conditions to be considered small entities both in that period and in the two tax periods prior to it.

  • When said turnover has been reached as a result of having carried out an operation under the special tax regime established in Chapter VII of Title VII of the LIS, provided that the entities that have carried out such operation meet the conditions to be considered as small in size, both in the tax period in which the operation is carried out and in the two tax periods prior to the latter.

When the entity is newly created, the amount of the turnover will refer to the first tax period in which the activity is actually carried out.

In the event that the entity forms part of a group of companies within the meaning of article 42 of the Commercial Code, regardless of the residence and the obligation to prepare consolidated annual accounts, the net amount of the turnover will refer to the set of entities belonging to said group, taking into account the eliminations and incorporations that correspond to the application of the accounting regulations.

This criterion shall also apply when a natural person, alone or jointly with other natural persons related by direct or collateral kinship, by blood or affinity, up to the second degree inclusive, are related to other entities of which they are partners in any of the cases referred to in article 42 of the Commercial Code, regardless of the residence of the entities and the obligation to prepare consolidated annual accounts.