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Form 200. Corporate Income Tax Declaration 2018

11.8.1.1 Joint taxation regime with the Basque Country

This section (on page 26 of form 200) must be completed by all Corporate Tax payers who must jointly pay taxes to the State Administration and the Provincial Councils of the Basque Country, provided that they are also subject to State regulations. This group of taxpayers are those who meet one of the following two circumstances, in accordance with the provisions of the aforementioned Economic Agreement:

  • That, having their tax domicile in common territory, they carry out operations in both territories (common and regional) during the tax period and that their volume of operations in the immediately preceding year has exceeded 7,000,000 euros.

  • That, having their tax domicile in the regional territory, they carry out operations in both territories (common and regional) during the tax period, their volume of operations in the immediately preceding year has exceeded 7,000,000 euros and the total of the operations carried out in the common territory constitute at least 75% of the total of those carried out in the previous year.

The above criteria are also applicable to taxpayers of the Non-Resident Income Tax who obtain income subject to it through a permanent establishment.

The following points should be taken into account:

  • Split payments will be made in proportion to the volume of operations carried out in each territory in accordance with the proportion determined in the last tax return-settlement.

  • Tax groups are subject to the regional tax consolidation regime when the parent company and all subsidiaries are subject to regional regulations under an individual tax regime, and will be subject to the common territory tax consolidation regime when the parent company and all subsidiaries are subject to the common territory tax regime under an individual tax regime. For these purposes, companies that are subject to the other regulations are considered excluded from the tax group.

    In accordance with the provisions of the twelfth Additional Provision of the LIS , for the purposes of the tax consolidation regime established in Chapter VI of Title VII of the LIS, tax groups in which the dominant entity is an entity resident in Spanish territory and subject to the regional regulations on Corporate Tax in accordance with the Economic Agreement with the Autonomous Community of the Basque Country, will be treated equally in their tax treatment to tax groups in which the dominant entity is not resident in Spanish territory.

  • The tax regime for economic interest groups and temporary business associations corresponds to the Basque Country when all the entities comprising them are subject to regional regulations.

In the event that the activity begins in the financial year, the figure of 7,000,000 euros will be calculated based on the volume of operations carried out in said financial year. If this financial year is less than one year, for the purposes of calculating the previous figure, the operations carried out will be increased to one year. Until the volume and location of the operations are known, those estimated by the taxpayer based on the operations that he plans to carry out during the year in which the activity begins will be taken as such for all purposes.