Economic activities carried out through entities under the income attribution regime

Regulations: Art. 39 Regulation Income Tax

Entities under income attribution regime that carry out agricultural, livestock or forestry activities apply the objective estimation method to determine the net income of said activities regardless of the circumstances that occur individually in their partners, heirs, co-owners or participants, provided that, in addition to the general conditions indicated above for economic activities carried out by natural persons, the following requirements are met:

• That all partners, heirs, commoners or participants are natural persons who pay taxes under the IRPF .

• That the application of the objective estimation method has not been waived in a timely manner.

  The resignation must be formulated unanimously by all the partners, heirs, commoners or participants that make up the entity; However, the revocation of the resignation may be submitted by only one of them.

Note: In order to define the scope of application of the objective estimation method to entities under the income attribution regime, not only the operations corresponding to the activities carried out by the entity itself must be taken into account, but also those corresponding to those carried out by its partners, heirs, co-owners or participants; the spouses, descendants and ascendants of these; as well as by other entities under an attribution regime in which any of the above persons participate and in which the circumstances expressed in the Rules for determining the volume of gross and purchase returns concur.

In any case, the net income determined by the entity under the income attribution regime will be attributed to the partners, heirs, co-owners or participants, according to the rules or agreements applicable in each case and, if these are not reliably recorded by the Administration, it will be attributed in equal parts.