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Practical Income Manual 2022.

Deduction for international double taxation in the cases of application of the international tax transparency regime

Regulations: Art. 91.10 Law Personal Income Tax

In the cases in which the imputation of income is appropriate in the international tax transparency regime , the tax or levy actually paid abroad due to the distribution of the dividends will be deductible for this concept. or shares in profits, whether in accordance with an agreement to avoid double taxation or in accordance with the internal legislation of the country or territory in question, in the part that corresponds to the positive income included in the tax base.

This deduction will be made even when the taxes correspond to tax periods other than the one in which the inclusion was made.

The deduction may not exceed the full amount that in Spain would be payable for the positive income imputed to the tax base.

Note: Under no circumstances can taxes paid in countries or territories classified as non-cooperative jurisdictions be deducted.

For these purposes, note that the first Additional Provision of Law 36/2006, of November 29, on measures for the prevention of tax fraud ( BOE of November 30 ), after the modification introduced by the sixteenth article of Law 11/2021, of July 9, on measures to prevent and combat tax fraud ( BOE of July 10), contains the definition of countries and territories that are considered non-cooperative jurisdictions that replaces tax havens, countries or territories with which there is no effective exchange of information, or zero or low taxation.

Now, until the countries or territories that are considered non-cooperative jurisdictions are approved by Ministerial Order, the countries or territories provided for in Royal Decree 1080/1991, of July 5, which determines the countries or territories that are considered tax havens.