a) Amount and limits of the deduction

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

New in 2025: Effective from 1 January 2025, a new possibility for the materialization of the RIC in assets related to the housing rental activity under the terms established in the Fifteenth Additional Provision of Law 19/1994.

Amount of deduction

Taxpayers of the PIT Those who carry out economic activities through direct estimation will be entitled to a deduction in the total tax rate for the net operating income allocated to the investment reserve, provided that these come from 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 net operating income for the year that are allocated to the reserve for investments in the Canary Islands, provided for in article 27 of Law 19/1994, of July 6, amending the Economic and Fiscal Regime of the Canary Islands.

See also Royal Decree 1758/2007, of December 28, approving the Regulations for the development of Law 19/1994, of July 6, amending the Economic and Tax 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: The portion of the profit obtained from activities related to shipbuilding, synthetic fibres, the automobile industry, steel industry and coal industry will not be eligible for the Canary Islands investment reserve regime established in article 27 of Law 19/1994, of 6 July.

Limits on deduction

The amount of this deduction may not exceed 80 percent of the portion of the full tax that corresponds proportionally to the amount of net operating income (excluding financial income and capital gains, including those from assets related to the activity) 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 being able to result in a deduction greater than 80% of the total amount.