Practical examples
Example 1:
Company "M" is a small entity that pays taxes under the special regime applicable to such entities provided for in articles 101 to 105 of the LIS , whose tax period coincides with the calendar year.
In 2019, the company was required to set aside a reserve of 100,000 euros, but only set aside the amount of 50,000 euros in that year.
In the Corporate Tax return for the year 2019 , company "M" should have completed the "Reserve allocation" section of the "Leveling reserve" table on page 20 bis of form 200 as follows:
Exercise generation | Reservation amount to be allocated | Reservation amount allocated | Reservation amount pending allocation | Reservation ready | ||||
---|---|---|---|---|---|---|---|---|
2019 | [02241] | 100,000 | [02242] | 50,000 | [02243] | 50,000 | [02244] | 0 |
Later in the 2020 financial year, company "M" provided an additional reserve of 25,000 euros corresponding to the amount of the reserve that it was required to provide in the 2019 financial year.
In the Corporate Tax return for the year 2020 , company "M" must complete the "Reserve allocation" section of the "Leveling reserve" table on page 20 bis of form 200 as follows:
Exercise generation | Reservation amount to be allocated | Reservation amount allocated | Reservation amount pending allocation | Reservation ready | ||||
---|---|---|---|---|---|---|---|---|
2020 | [02413] | 100,000 | [002414] | 75,000 | [02415] | 25,000 | [02416] | 0 |
As can be seen in this example, the amount of 100,000 euros to be entered in the column "Reserve amount to be allocated" does not vary in the different corporate tax returns as long as the obligation to allocate the equalisation reserve persists.
Example 2:
Company "A" is a small entity that pays taxes under the special regime applicable to such entities provided for in articles 101 to 105 of the LIS, whose tax period coincides with the calendar year.
Exercise 2019:
Equity of company "A" as of 01/01/2019 | Equity of company "A" as of 31/12/2019 | ||
---|---|---|---|
Social capital
|
300,000 |
Social capital
|
300,000 |
Legal reserve
|
30,000 |
Legal reserve
|
30,000 |
Statutory reservations
|
10,000 |
Statutory reservations
|
10,000 |
Voluntary reserves
|
300 |
Voluntary reserves
|
30,300 |
Result of the 2018 financial year
|
50,000 |
---
|
--- |
Other data:
Calculation of capitalization and equalization reserves for the 2019 financial year
-
First, company "A" calculates the capitalization reserve in accordance with article 25 of the LIS:
Total: 300.300 Total: 330.300 FP for the purposes of article 25 as of 01/01/2019 FP for the purposes of article 25 as of 31/12/2019 Social capital300,000 Social capital300,000 Voluntary reserves300 Voluntary reserves30,300 According to the above data, the increase in equity (Δ FP) is 30,000
Therefore, the capitalisation reserve for the year, as established in article 25 of the LIS, will be 10% of the increase in the company's equity, with a limit of 10% of the positive tax base of the tax period prior to this reduction, the integration referred to in section 12 of article 11 of this Law and the compensation of negative tax bases.
The requirements for maintaining the increase in equity must be met. A capitalisation reserve of 3,000 must also be provided.
-
As for the levelling reserve for the 2019 financial year, as established in article 105 of the LIS, it may be reduced by up to 10% of the positive tax base, with a limit of 1 million euros:
The amount of 24,700 will be added to the tax base of the tax periods ending in the 5 years immediately following the end of the 2019 tax period, provided that company A has a negative tax base, and up to the amount thereof. The remaining amount will be added to the tax base of the tax period corresponding to the date of completion of the aforementioned period.
A leveling reserve of 24,700 must be provided in 2019.
The settlement of the Corporate Tax for the year 2019 is as follows:
IS settlement 2019 Accounting result before taxes 2019 250,000 Differences0 BI prior to the reduction of art. 25 and the compensation of negative BI 250,000 Capitalization reserve (limit 10% x 250,000 = 25,000)-3.000 Compensation of negative tax bases from previous periods 0 Taxable base 247,000 Leveling Pool (Limit 1,000,000)-24.700 BI after leveling reservation 222.300 Tax rate 25% Total tax liability 55.575 Tax deductions and bonuses 0 Net share 55.575 Withholdings and prepayments -5.000 Due tax 50.575
Exercise 2020:
Equity of company "A" as of 01/01/2020 | Equity of company "A" as of 31/12/2020 | ||
---|---|---|---|
Social capital
|
300,000 |
Social capital
|
300,000 |
Legal reserve
|
30,000 |
Legal reserve
|
30,000 |
Statutory reservations
|
10,000 |
Statutory reservations
|
20,000 |
Voluntary reserves
|
30,300 |
Capitalisation reserve
|
3,000 |
Result of the 2019 financial year
|
250,000 |
Levelling reserve
|
24,700 |
---
|
--- |
Voluntary reserves
|
60,300 |
Other data:
Calculation of capitalization and equalization reserves for the 2020 financial year
-
First, company "A" calculates the capitalization reserve in accordance with article 25 of the LIS:
Total: 330.300 Total: 363,300 FP for the purposes of article 25 as of 01/01/2020 FP for the purposes of article 25 as of 31/12/2020 Social capital300,000 Social capital300,000 Voluntary reserves30,300 Voluntary reserves60,300 ------ Capitalization reserve3,000 According to the above data, the increase in equity (Δ FP) is 33,000.
Therefore, the capitalisation reserve for the year, as established in article 25 of the LIS, will be 10% of the increase in the company's equity, with a limit of 10 percent of the positive tax base of the tax period prior to this reduction, the integration referred to in section 12 of article 11 of this Law and the compensation of negative tax bases.
-
Regarding the leveling reserve for the 2020 financial year, given that the taxable base for the period is -20,000, the amounts reduced by the leveling reserve for 2019 must be added up to said amount.
The settlement of the Corporate Tax for the year 2020 is as follows
IS 2020 settlement Accounting result before taxes 2020 -20,000 Differences0 BI prior to the reduction of art. 25 and the compensation of negative BI -20,000 Capitalization reserve (limit 0)0 Compensation of negative tax bases from previous periods 0 Taxable base -20,000 Leveling reserve (negative BI limit: -20,000)20,000 BI after leveling reservation 0 Tax rate 25% Total tax liability 0 Tax deductions and bonuses 0 Net share 0 Withholdings and prepayments -5.000 Due tax -5.000
Completion of the capitalization and equalization reserve tables in model 200 for the years 2019 and 2020
• 2019 Corporate Tax Return
Levelling reserve (page 20 bis of model 200)
Exercise generation | BI minority amount in the period / pending added to the beginning of the period | Amount added to base taxable in the period | Pending amount of to be added in future periods | |||
---|---|---|---|---|---|---|
2019 | [01034] | 24,700 | [01730] | 0 | [01731] | 24,700 |
Exercise generation | Reservation amount to be allocated | Reservation amount allocated | Reservation amount pending allocation | Reservation ready | ||||
---|---|---|---|---|---|---|---|---|
2019 | [02241] | 24,700 | [02242] | 24,700 | [02243] | 0 | [02244] | 0 |
Capitalization reserve (page 20 bis of form 200)
Exercise generation | Right to reduce BI generated in the period / pending apply at the beginning of the period | BI reduction applied | Pending BI reduction of to be applied in future periods | |||
---|---|---|---|---|---|---|
2019 | [01985] | 3,000 | [01986] | 3,000 | [01987] | 0 |
Capitalization reserve provided in the year | [01140] | 0 |
• 2020 Corporate Tax Return
Levelling reserve (page 20 bis of model 200)
Exercise generation | BI minority amount in the period / pending added to the beginning of the period | Amount added to base taxable in the period | Pending amount of to be added in future periods | |||
---|---|---|---|---|---|---|
2020 | [01034] | 24,700 | [01730] | 20,000 | [01731] | 4.700 |
Exercise generation | Reservation amount to be allocated | Reservation amount allocated | Reservation amount pending allocation | Reservation ready | ||||
---|---|---|---|---|---|---|---|---|
2020 | [02413] | 0 | [02414] | 0 | [02415] | 0 | [02416] | 20,000 |
Capitalization reserve (page 20 bis of form 200)
Exercise generation | Right to reduce BI generated in the period / pending apply at the beginning of the period | BI reduction applied | Pending BI reduction of to be applied in future periods | |||
---|---|---|---|---|---|---|
2020 | [02407] | 3.300 | [02408] | 0 | [02409] | 3.300 |
Capitalization reserve provided in the year | [01140] | 3,000 |