2. General deduction regime

The business investments that in fiscal year 2020 determine the right to deduct for this concept are contained in articles 35, 36 and 38 of Law 27/2014, of November 27, on Tax on Companies (hereinafter LIS).

Deduction for job creation of article 37 of the LIS: with effects for tax periods beginning on January 1, 2019, the sole repealing provision of Royal Decree-Law 28/2018, of December 28, for the revaluation of public pensions and other urgent measures in social and labor matters and employment, repealed article 4 of Law 3/2012, of July 6, on Urgent Measures for the Reform of the Labor Market, which established the possibility of celebrating employment contracts for an indefinite period to support entrepreneurs.

However, the sixth transitional provision of the aforementioned Royal Decree-Law 28/2018 maintained the validity of those contracts that had been concluded prior to said date (January 1, 2019) under the regulations in force at the time of their conclusion. and those of their corresponding incentives.

As a consequence of the above, the deduction for job creation in article 37 of the LIS will continue to apply to indefinite employment contracts to support entrepreneurs entered into before January 1, 2019.

The deduction of article 37 of the LIS had to be made in the full amount of the tax period corresponding to the end of the one-year trial period required in the corresponding type of contract. Therefore, for contracts validly signed in 2018 whose trial period ended in one year, the deduction could be applied to the full 2019 installment.

Unlike the previous ones, in the 2020 financial year, in principle the right to apply this deduction cannot be generated, since as of January 1, 2019, this type of contract will not be able to be signed.

Furthermore, in accordance with the provisions of section 5 of the twenty-fourth transitional provision of the LIS , the deduction for investments of article 37 of the consolidated text of the Corporate Tax Law in those cases in which the investment in assets used in economic activities is carried out in accordance with a special investment plan approved by the Tax Administration at the proposal of the taxpayer and said plan allows the net returns from economic activities from the 2014 tax period are invested in new elements of tangible fixed assets or real estate investments in fiscal year 2020.

The table containing each of these deduction modalities, their deduction percentage and the joint limit, as well as a study and specific comment on each of these deductions, includes the following sections: