a) Amount and limits of the deduction

Regulations: Art. 27.15 Law 19/1994, of July 6, modifying the Economic and Fiscal Regime of the Canary Islands

Deduction amount

Taxpayers of Personal Income Tax who carry out economic activities in direct estimation will have the right to a deduction in the full quota for the net operating income that is allocated to the reserve for investments, as long as these come from of economic activities carried out through establishments located in the Canary Islands.

The amount of this deduction is variable and is determined by applying the average tax rate (sum of the average general and regional tax rates, boxes [0534] and [0535 ] of the declaration) to the provisions of the net operating income of the year that are allocated to the reserve for investments in Canary Islands, provided for in article 27 of Law 19/1994, of July 6, modifying the Economic and Fiscal Regime of the Canary Islands.

See also Royal Decree 1758/2007, of December 28, which approves the Regulation for the development of Law 19/1994, of July 6, modifying the Economic and Fiscal Regime of the Canary Islands, in matters relating to tax incentives in indirect taxation, the reserve for investments in the Canary Islands and the Canary Islands Special Zone ( BOE of January 16, 2008).

Note: will not be able to benefit from the reserve regime for investments in the Canary Islands established in article 27 of Law 19/1994, of July 6, the part of the profit obtained in the exercise of activities typical of shipbuilding, synthetic fibers, automobile, steel and coal industry.

Deduction limits

The amount of this deduction may not exceed 80 per 100 of the part of the full quota that proportionally corresponds to the amount of net operating income that comes from establishments located in the Canary Islands.

In joint taxation, the maximum limit of the deduction is applied individually to each of the spouses , if both are entitled to the deduction, without this application resulting in a deduction greater than the 80 percent of the full fee.