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Practical manual for Income Tax 2021.

Phase 5: Determination of the reduced net return on the activity

Regulations: Articles 32.1 Law IRPF and 25 Regulation

The reduced net income from the activity is the result of reducing the amount of the net income from the activity by an amount equivalent to 30% of the concept "other business income" whose generation period is greater than two years, as well as those that are classified by regulation as having been obtained in a notoriously irregular manner over time, when these are imputed in a single tax period.

For these purposes, the following are considered to be obtained in a clearly irregular manner over time, exclusively, when they are attributed in a single tax period:

  • Capital grants for the acquisition of non-depreciable fixed assets.

  • Compensation and aid for cessation of economic activities.

  • Compensation received in lieu of economic rights of indefinite duration.

Maximum amount of performance to which the reduction applies:

The amount of net income referred to in this section to which the aforementioned reduction will be applied may not exceed the amount of 300,000 euros per year .

In the event that several irregular returns of the same nature are obtained, and their amount exceeds the limit of 300,000 euros of maximum amount on which to apply the 30% reduction, the maximum reduction will be distributed proportionally between all the returns of that nature.