Deduction for research and development activities
Regulation: Article 35.1 LIS
-
To apply the deduction for research and development activities carried out in the Canary Islands, entities must comply with the general requirements established for these deductions in article 35.1 of the LIS (see Chapter 6 of this Manual).
-
Regarding the percentages established in article 35.1 of the LIS for research and development expenses, the increased percentages of article 94.1.a) of Law 20/1991 will be applied. The reason is that the deduction for research and development activities continues to be applied in the Canary Islands in accordance with the deduction regime in force at the time of the repeal of article 26 of Law 61/1978 and with the specialties introduced by article 94 of Law 20. /1991.
For these purposes, the 45 percent will be applied to the research and development expenses incurred during the year, and to excess expenses with respect to the average of those incurred in the two previous years, the 75.6 percent. Likewise, 28 percent of investments in elements of tangible and intangible assets are deductible, excluding real estate and land, provided that they are exclusively used for research and development activities. Finally, there is an additional deduction of 37 percent applicable to personnel expenses corresponding to qualified researchers assigned exclusively to research and development activities.
-
In the same way that the percentages are increased, the limits applicable to this deduction will also be increased in accordance with the provisions of article 94.1. b) of Law 20/1991, so it will be subject to the joint limit of 60/90 or 70/100 (La Palma, La Gomera and El Hierro) percent.
In the event that the taxpayer exercises the option provided for in article 39.2 of the LIS , these deductions will not be subject to the joint limit of 60/90 or 70/100 (La Palma, La Gomera and El Hierro) percent established in article 94.1 b) of the LIS.