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Practical Guide to Income Tax 2025. Part 2. Autonomous community deductions

By investment in the acquisition of shares and social participations of new or recently created entities

Regulations:  Art. 9Consolidated text of the current legal provisions issued by the Autonomous Community of the Canary Islands regarding transferred taxes, approved by Legislative Decree 1/2009, of April 21

Amount and maximum limit of the deduction

  • He 20 percent of the amounts invested during the year in the acquisition of shares and equity interests as a result of company formation agreements or capital increases in commercial companies that take the form of public limited company and private limited company.

    The applicable deduction limit will be 4,000 euros per year .

  • 30 percent of the amounts invested during the year in the acquisition of shares and equity interests as a result of company formation agreements or capital increases in:

    • to) companies created or owned by universities or research centers;

    • b) worker-owned corporations, worker-owned limited liability companies and cooperative societies.

    He deduction limit applicable will be, both in case a) and in case b), of 6,000 euros per year.

Important : The present deduction applies because three guys of different investments, for each of which a limit is set distinct and independent.

In case of joint taxation, each taxpayer the limit of the family unit will apply individual (or limits where applicable) and the corresponding deductions for each of them will be added together.

Requirements and other conditions for the application of the deduction

  • That, as a consequence of the participation acquired by the taxpayer, computed together with the participation held in the same entity by his/her spouse or persons related to the taxpayer by reason of kinship, in a direct or collateral line, by consanguinity or affinity up to the third degree included, more than 40% of the total share capital of the entity or its voting rights are held during any day of the calendar year.

    Attention : It should be recalled that Article 41 of the Consolidated Text assimilates members of de facto couples to spouses with respect to the autonomous deductions of the PIT.

  • That the taxpayer do not hold executive or managerial positions in the investee entity.

  • That said participation is maintained for a minimum of three years.

  • That the entity from which the shares or interests are acquired meets the following requirements:

    1. May it have its registered and tax domicile in the Autonomous Community of the Canary Islands.

    2. That develops a economic activity .

      For these purposes, the entity will not be considered to carry out an economic activity when its main activity is the management of movable or immovable assets, in accordance with the provisions of article 4.Eight.Two.a) of Law 19/1991, of June 6, on the Wealth Tax.

    3. That, in the case in which the investment made corresponds to the constitution of the entity , from the first fiscal year this entity has at least one person hired with a full-time employment contract, registered in the General Social Security Regime.

      Attention : this requirement will not be required in the case of investment in worker-owned corporations, worker-owned limited liability companies and cooperative societies.

    4. That, in the case where the investment made corresponds to a capital increase of the entity , said entity had been established within the three years prior to the capital increase and that the average workforce of the entity during the two fiscal years following the increase increases with respect to the average workforce it had in the previous twelve months by at least one person with the previous requirements and said increase is maintained for at least another twenty-four months.

      To calculate the total average workforce of the entity and its increase, the persons employed in accordance with the terms established by labour legislation will be taken into account, taking into account the contracted working day in relation to the full working day.

Incompatibility

  • The amounts invested in the same action or participation of an entity they will not be able to grant rights to the application simultaneous of the present deduction and of the assumption provided for in section f. of the deduction "For donations and contributions for cultural, sporting, research or teaching purposes" (relating to capital contributions made to technology-based companies created or developed from patents or results generated by research projects carried out in Canary Islands universities).

  • If acquired in 2025 several shares (or stakes) of the same entity Although the taxpayer may not apply both deductions for the same share (or participation), he may apply the present deduction to part of such shares or participations and the remaining ones (different from the previous ones but of the same entity) the case provided for in section f. of the deduction "For donations and contributions for cultural, sporting, research or teaching purposes".

Important: Once the information necessary for the calculation has been entered by the taxpayers entitled to the deduction, it will be automatically transferred to the section "Additional information on the regional deduction for investment in the acquisition of shares and equity interests in new or recently created entities in Andalusia, Aragon, Principality of Asturias, Balearic Islands, Canary Islands, Cantabria, Castile and León, Castile-La Mancha, Catalonia, Extremadura, Galicia, Madrid, Murcia and the Valencian Community", of Annex B.11 of the declaration.