C. Deduction for production of certain live shows (art. 36.3 LIS)
Beneficiaries of the deduction
Since January 1, 2021, this deduction may be applied, in addition to taxpayers who produce and exhibit certain live performing and musical arts shows ( producers ), to taxpayers, businessmen or professionals who participate in the financing of these productions made by another taxpayer ( investors ), under the terms set out in the section corresponding to the deduction for investments in Spanish film productions and audiovisual series of art. 36.1 LIS.
Important : In order for the investor to be eligible for this deduction, it is necessary that he/she signs a financing contract with the producer and that both parties notify the tax authorities of this circumstance before the end of the tax period in which the deduction is generated, providing both the signed financing contract and the certifications of compliance with the requirements set out in article 36.1 for the application of the deduction.
To carry out this communication regulated in art. 39.7 LIS, the management " Presentation of communication regulated in art. 39.7 LIS " has been created in the electronic headquarters of the State Tax Administration Agency.
Percentage of deduction
Expenses incurred in the production and exhibition of live performing arts and musical shows will be subject to a deduction of 20 percent .
Deduction base
The base of the deduction will consist in the direct costs of an artistic, technical and promotional nature, incurred in such activities.
This deduction base will be reduced by the amount of the subsidies received to finance the expenses that generate the right to it.
Maximum deduction amount
The deduction generated in each tax period cannot exceed the amount of 500,000 euros per taxpayer.
However, in the case of investor , although he may apply the deduction on the contributions disbursed in each tax period under the same conditions as if it had been applied by the producer, the maximum amount of the deduction may not exceed, in terms of the quota, the result of multiplying by 1.20 the amount of the amounts disbursed by him to finance the latter. The excess may be applied by the producer.
Note: The accreditation of the deduction by the investor will be incompatible, totally or partially, with the deduction to which he would be entitled on the part of the producer.
In short:
| Percentage of deduction | Maximum amount | Deduction base | ||
|---|---|---|---|---|
| 20% | €500,000 for each production carried out Without exceeding 80% of the expenses |
Direct costs of an artistic, technical and promotional nature incurred. | ||
Requirements
The requirements necessary for the application of the deduction are:
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The taxpayer must have a certificate to prove this, under the terms established by Ministerial Order, issued by the National Institute of Performing Arts and Music.
See in this regard Order ECD/2836/2015, of December 18, regulating the procedure for obtaining the certificate from the National Institute of Performing Arts and Music, provided for in Law 27/2014, of November 27, on Corporate Income Tax.
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That, of the benefits obtained in the development of these activities in the year in which the right to the deduction is generated, the taxpayer allocates at least 50 percent to carrying out activities that give the right to apply the deduction provided for in this section.
The period for compliance with this obligation will be between the beginning of the fiscal year in which the aforementioned benefits were obtained and the 4 years following the end of said fiscal year.
Limit
The amount of the deduction, together with any subsidies received by the taxpayer, may not exceed of said expenses.
Tax period in which the deduction is applied
We must distinguish, depending on the beneficiary of the deduction, two moments:
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Producer
The producer may not apply until he or she obtains the required certificate from the National Institute of Performing Arts and Music. Once obtained, the deduction will be applied to the expenses incurred in each tax period in the production and exhibition of live performing arts and music shows.
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Investor
Unlike the producer, the taxpayer who participates in the financing of production will apply the deduction annually based on the contributions disbursed in each tax period.