Accelerated amortization of new elements of tangible assets and real estate investments and intangible assets

Regulations: Art. 103 LIS

Holders of economic activities, whose net income is determined by the direct estimation method, in any of its two modalities, in which each and every one of the requirements indicated below are met, may depreciate in an accelerated manner, for tax purposes, the new elements of tangible fixed assets and real estate investments and intangible fixed assets, in the terms indicated below.

Requirements

a) That the economic activity is considered a small business for tax purposes in the year in which the elements referred to in this tax benefit are made available.

b) That they are new elements of tangible fixed assets and real estate investments, as well as elements of intangible fixed assets, assigned to economic activities.

For these purposes, an item is deemed to be new when it is used or put into working order for the first time by the taxpayer.

Accelerated deductible amortization

New elements of tangible fixed assets and real estate investments, as well as elements of intangible fixed assets may apply the percentage resulting from multiplying by 2 the maximum linear coefficient provided for in the officially approved amortization tables. 

Please note in this regard that the table of amortization coefficients applicable in the normal form of the direct estimation method is included in article 12.1.a) of the LIS . In the simplified version of the aforementioned method, the applicable amortization table is contained in the Order of March 27, 1998 (BOE of March 28).

However, within intangible fixed assets, those whose useful life cannot be reliably estimated, as well as goodwill, may apply the percentage of 150% to the amount that is deductible from applying the provisions of article 12.2 of the LIS.

Article 12.2 of the LIS establishes that intangible assets whose useful life cannot be reliably estimated, as well as goodwill, will be deductible with the maximum annual limit of one twentieth of their amount (5 percent). 

Please note that with effect for tax periods 2016 and subsequent years, all intangible fixed assets are assets with a defined useful life, so all of them, including goodwill, will be amortized over that useful life.

Without prejudice to the foregoing, for assets to which the transitional regime provided for in the thirteenth transitional provision of the LIS is applicable, that is, for those to which, in tax periods beginning before 1 January 2015, a depreciation coefficient other than that corresponding to the application of the depreciation table provided for in article 12.1 of the LIS was being applied, the new useful life of the asset must be determined based on the maximum linear coefficient provided for in the table established in the LIS, in order to, once determined, multiply by 2 the coefficient by which it must be depreciated during the tax periods remaining to complete its new useful life, on the net tax value existing at the beginning of the first tax period beginning on or after 1 January 2015.

Compatibility

This amortization regime will be compatible with any tax benefit that may arise due to the assets subject to it. Furthermore, this regime is subsidiary to the regime of free amortization with job creation, so it may be applied to the part of investment in new tangible fixed assets that exceeds the maximum limit set for the latter.