4.2.56 Codes 00340 and 01589 foreign tax borne by the taxpayer, not deductible because it affects income with a deduction for double taxation (Article 31.2 LIS)

Whereas, since it affects income included in the tax base, obtained and taxed abroad by a tax (recorded as an expense) of an identical or analogous nature to the Corporate Tax, and in relation to said income the taxpayer is entitled to the deduction to avoid international double taxation established in article 31.2 of the LIS , the amount of tax paid abroad will be included in code [00340], as an increase correction, even if it is not fully deductible. The portion of the amount of tax paid abroad that is not subject to deduction from the total amount by application of the provisions of section 1 of article 31 of the LIS will be considered a deductible expense, provided that it corresponds to the performance of economic activities abroad.

Whereas, since it affects income included in the tax base, obtained and taxed abroad by a tax (recorded as an expense) of an identical or similar nature to the Corporate Tax, and in relation to said income the taxpayer is entitled to the deduction to avoid international double taxation established in article 31.2 of the LIS, the amount of tax paid abroad will be included in code [00340], as an increase correction, even if it is not fully deductible.

In the [00340] key for increases, the amount of foreign tax borne by the taxpayer, which is not deductible because it affects income with the right to the deduction for double taxation under article 31.2 of the LIS, must be entered, filling in, where applicable, its corresponding breakdown boxes.

In the [01589] reduction key, the portion of the tax paid abroad that has not generated a deduction for double taxation due to exceeding the rate that would be applicable in Spain if the income had been obtained in Spanish territory, and provided that it corresponds to the performance of economic activities abroad, must be recorded, filling in, where applicable, the corresponding breakdown boxes.