Aspects to take into account for your application
Regulations: Art. 68.2.b) Law Personal Income Tax
1. Taxpayers who can apply the deduction
This deduction can be applied by Personal Income Tax taxpayers who carry out economic activities and who meet the requirements to be considered a small-sized entity, in the year in which the investment returns are obtained.
See the concept of a small entity discussed in Chapter 7.
2. Purpose and basis of the deduction
The net income from economic activities for the years 2021 or 2022 that are invested in 2022 will give the right to the deduction ##3####1##in new elements of tangible fixed assets or real estate investments used for economic activities carried out by the taxpayer.
For these purposes, it is understood that the net income from economic activities of the tax period is the object of investment when an amount equivalent to the part of the general positive taxable base of the tax period that corresponds to such income is invested, without in any case the same amount can be understood as invested in more than one asset.
The basis of the deduction will be the amount invested, that is, the part of the positive general taxable base of the tax period corresponding to the net income from economic activities of the tax period subject to investment in new elements of tangible fixed assets or real estate investments.
3. Time to make the investment
The investment in assets used in economic activities must be made in the tax period in which the returns to be reinvested are obtained or in the following tax period .
The right to apply the deduction will occur in the tax period in which the investment is made, although it will be conditional on the impact of the asset element on the economic activity within the investment period.
The investment will be deemed to have been made on the date on which the assets are made available, even in the case of assets that are the subject of the financial leasing contracts referred to in section 1 of the third Additional Provision. of Law 10/2014, of June 26, on the organization, supervision and solvency of credit institutions. However, in the latter case, the deduction will be conditional, with a resolutive nature, on the exercise of the purchase option.
Precision: Law 26/1988, of July 29, on discipline and intervention of credit institutions was repealed, with effect from June 28, 2014, by letter e) of the repealing provision of Law 10/2014, of June 26, on the organization, supervision and solvency of credit institutions
The making available of the assets must be understood as the availability of the thing that is the object of the contract, that is, its delivery, which constitutes the mode of acquisition of ownership by the purchaser.
The deduction will be made in the full installment corresponding to the tax period in which the investment is made.
4. Percentage of deduction
5 per 100 , in general.
2.5 per 100 , in the following cases:
a) If in the year in which the reinvested returns were obtained, the reduction of 20 percent of the declared positive net return was applied, provided for in article 32.3 of the Personal Income Tax Law for the taxpayers who begin the exercise of an economic activity and determine its net return in accordance with the direct estimation method.
b) If the reinvested returns gave rise to the right to deduction for income obtained in Ceuta or Melilla under article 68.4 of the Personal Income Tax Law in the year in which they were obtained or the right to deduction for habitual and effective residence on the island of La Palma during the 2022 and 2023 tax periods, provided for in the fifty-third Additional Provision of the Personal Income Tax Law .
The percentage of 5% will be applicable if in the year in which the reinvested returns were obtained, the deduction for income obtained in Ceuta or Melilla or, where applicable, the deduction for income obtained on the island of La Palma was not applied. , nor the reduction for beginning of activity of article 32.3 of the Personal Income Tax Law , even if said deduction or reduction is applied in the following year (investment year).
The amount of the deduction may not exceed the sum of the full state and regional tax for the tax period in which the net income from economic activities was obtained.
When the deduction is applied in 2022 as a result of the investment of the net returns obtained in 2021 and in this last period joint taxation has been chosen, the quota limit mentioned above will be the one corresponding to the taxpayer who makes the investment.
6. Permanence in the taxpayer's assets of assets subject to investment
The assets subject to investment must remain in operation in the taxpayer's assets, except for justified loss, for a period of 5 years, or during their useful life if shorter.
The transfer of the assets object of the investment before the end of the required maintenance period will determine the loss of the deduction and, therefore, the amount of said deduction must be entered in the settlement of the tax period in which it was received. expresses the non-compliance, along with the corresponding late payment interest.
However, the deduction will not be lost if the transfer of the assets subject to investment occurs before the end of the period indicated in the previous paragraph and the amount obtained or the net book value, if lower, is invested in the terms established to be entitled to this deduction.
In relation to this requirement, the entity has a period of two years from the beginning of the tax period in which the transfer occurs until the end of the following tax period, to make the investment.
This deduction is incompatible, in relation to the same assets with the application of the freedom of amortization, with the deduction for investments regulated in article 94 of Law 20/1991, of June 7, modifying the tax aspects of the Regime Fiscal Economic of the Canary Islands, and with the Reserve for investments in the Canary Islands regulated in article 27 of Law 19/1994, of July 6, modifying the Economic and Fiscal Regime of the Canary Islands.