1. Requirements to consider an expense as deductible

Expenses that meet the following requirements are considered tax deductible:

1. That they are linked to the economic activity carried out. That is, they are specific to the activity.

   The deductibility of expenses is conditioned by the principle of their correlation with income, in such a way that those for which it is proven that they have been incurred in the exercise of the activity, which are related to obtaining income, will be deductible, in the terms provided in the aforementioned legal precepts, while when that connection does not exist or is not sufficiently proven, they could not be considered as tax deductible from the economic activity.

2. That they are suitably justified.

   In accordance with the provisions of article 106.4 of the General Tax Law, deductible expenses and deductions that are made, when they are caused by operations carried out by businessmen or professionals, must be justified, as a priority, by invoice delivered by the businessman or professional who has carried out the corresponding operation that meets the requirements indicated in the tax regulations.

   Now, and without prejudice to the above, invoice does not constitute a privileged means of proof regarding the existence of the operations, so once the Administration reasonably questions its effectiveness, It is up to the taxpayer to provide evidence regarding the reality of the operations.

3. That they are registered in the accounting or in the record books that taxpayers who carry out economic activities must keep.