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Form 200. Corporate Income Tax Declaration 2019

2.7.2.1 Small entity incentives (Chapter XI Title 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 ( LIS).

These entities may apply the tax incentives established in said 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 property entity in the terms established in article 5.2 of the LIS .

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

Net amount of turnover immediately preceding tax period x 365 days divided by the number of days of the immediately preceding tax period

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

  • When the entity or set 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 achieved 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 reduced dimension, 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 is part of a group of companies within the meaning of article 42 of the Commercial Code, regardless of residence and the obligation to prepare consolidated annual accounts, the net amount of the turnover will refer to to the group of entities belonging to said group, taking into account the eliminations and incorporations that correspond by application of accounting regulations.

This criterion will also be applied when a natural person alone or jointly with other natural persons linked by ties of kinship in a direct or collateral line, by blood or by affinity, up to the second degree inclusive, are in relation 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.