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Practical manual for Income Tax 2019.

Deductions from the full fee

For incentives and stimuli to business investment in economic activities in direct estimation

  • New deductions are included in the business sector linked to certain events of exceptional public interest approved in the General State Budget Law for the year 2018 that have come into force during the 2019 financial year.

  • Deductions for incentives and stimuli to business investment of the Corporate Tax Law
    For the application of deductions for job creation, article 37 of the LIS requires that the hiring be done through an open-ended employment contract to support entrepreneurs, as defined in article 4 of Law 3/2012, of July 6, on Urgent Measures for the Reform of the Labor Market.

    However, these contracts have been abolished, with effect from 1 January 2019, by Royal Decree-Law 28/2018 of 28 December, for the revaluation of public pensions and other urgent measures in social, labour and employment matters, which, however, maintains the validity of those contracts that had been signed prior to said date (1 January 2019) under the regulations in force at the time of their signing and those of their corresponding incentives.

    As a result of the above, the deductions for job creation in article 37 of the LIS may only be applied to contracts made through open-ended employment contracts to support entrepreneurs that were signed before January 1, 2019.

  • Special deduction regimes for economic activities carried out in the Canary Islands.

    Law 8/2018, of November 5, which modifies Law 19/1994, of July 6, modifying the Economic and Fiscal Regime of the Canary Islands ( BOE of 6) has introduced, with effect from November 7, 2018, the following new features

Canary Islands Investment Reserve

Amendments are made to Article 27 of Law 19/1994 regulating the Reserve for Investments in the Canary Islands.

Deductions for investments in the Canary Islands.

  • The limits on expenses for the deduction for investments in film productions, audiovisual series and live performances of performing arts and music carried out in the Canary Islands are raised.
  • In the islands of La Palma, La Gomera and El Hierro, the maximum limit on the quota established for the application in the Canary Islands of the set of deductions for incentives and stimuli for business investment in economic activities is raised, provided that the community regulations on state aid allow it and it concerns investments contemplated in Law 2/2016, of September 27 and other laws on measures for the regulation of the economic activity of these islands.
  • A new article 94 bis is added to Law 20/1991, of June 7, modifying the fiscal aspects of the Economic Fiscal Regime of the Canary Islands, which establishes that entities that hire a worker to carry out their activity in the Canary Islands will have the right to enjoy the tax benefits for job creation established by tax regulations in accordance with the requirements established therein, increasing them by 30 percent.