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Practical Income Manual 2020.

Phase 1. Integration and compensation of income obtained in the tax period

  1. The income from movable capital that forms part of the savings tax base (those derived from participation in the own funds of entities, from the transfer of own capital to third parties, from capitalization operations, from life or disability insurance contracts and income resulting from the imposition of capital) are integrated and compensated exclusively among themselves in each tax period , resulting in a positive or negative balance .

    • The positive balance resulting from said compensation is integrated into the savings tax base, without prejudice to the compensation discussed below.
    • The negative balance is offset by the positive balance of the capital gains and losses derived from the transfer of assets that make up the savings tax base, obtained in the same tax period, with the limit of 25 percent of said positive balance.

    If after said compensation a negative balance remains, its amount will be compensated in the following four years in the same order established in the previous paragraphs.

  2. The capital gains and losses derived from the transfer of assets , regardless of their period of permanence, are integrated and offset exclusively among themselves in each tax period, resulting in a positive balance or negative.

    • The positive balance resulting from said compensation is integrated into the savings tax base, without prejudice to the compensation regime discussed below.
    • The negative balance will be offset by the positive balance of the income from movable capital that is part of the savings tax base, obtained in the same tax period, with a limit of 25 percent of said balance positive.

    If after said compensation a negative balance remains, its amount will be compensated in the following four years in the same order established in the previous paragraphs.

The above compensations must be made in the maximum amount allowed by each of the following years and without being able to be carried out outside the aforementioned period by accumulating negative income from subsequent years.