2. General deduction system

The business investments that in the 2022 fiscal year determine the right to deduct for this concept are contained in articles 35, 36 and 38 of the LIS .

Regarding the LIS see Law 27/2014, of November 27, on Corporate Tax.

Deduction for job creation in article 37 of the LIS : With effect for tax periods beginning on 1 January 2019, the sole repealing provision of Royal Decree-Law 28/2018 of 28 December 2018 on the revaluation of public pensions and other urgent measures in social, labour and employment matters repealed Article 4 of Law 3/2012 of 6 July 2012 on Urgent Measures to Reform the Labour Market, which established the possibility of entering into open-ended employment contracts to support entrepreneurs.

However, the sixth transitional provision of the aforementioned Royal Decree-Law 28/2018 maintained the validity of those contracts that had been signed prior to said date (January 1, 2019) under the regulations in force at the time of their signing and those of their corresponding incentives.

As a result of the above, the deduction for job creation in article 37 of the LIS continued to apply to open-ended employment contracts to support entrepreneurs entered into before January 1, 2019. This deduction had to be applied to the full amount of the tax period corresponding to the end of the one-year trial period required in the corresponding type of contract. Therefore, for contracts validly signed in 2018 whose trial period ended in one year, the deduction could be applied to the full amount of the 2019 fiscal year.

However, starting with the 2020 financial year, the right to apply this deduction is not generated, as these contracts have been repealed since January 1, 2019 .

Furthermore, in accordance with the provisions of section 5 of the twenty-fourth transitional provision of the LIS , the deduction for investments of article 37 of the revised text of the Corporate Tax Law, approved by Royal Legislative Decree 4/2004, is applicable in 2022, in those cases in which the investment in assets related to economic activities is made in accordance with a special investment plan approved by the tax authorities at the proposal of the taxpayer and said plan allows the net income from economic activities for the 2014 tax period to be invested in new tangible fixed assets or real estate investments in the 2022 financial year.

Below is a table showing each of these types of deductions, their deduction percentage and the joint limit, as well as a specific study and commentary on each of them: