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Practical Manual for Companies 2020.

First application of Banco de España Circular 4/2017 concerning credit entities

For tax periods beginning on or after 1 January 2018, Royal Decree-Law 27/2018 modifies the LIS with the aim of introducing into Corporate Tax the effects of Circular 4/2017, of 27 November , of the Bank of Spain, to credit institutions.

The charges and credits to reserve accounts generated on the occasion of the adjustments of the first application of Circular 4/2017 will have fiscal effects, when appropriate by the application of the regulations governing the Tax, so they must be included in the taxable base of the Tax corresponding to the tax periods beginning on or after 1 January 2018.

For these purposes, the second paragraph of article of the LIS establishes that changes in value arising from the application of the fair value criterion will not have fiscal effects long as they do not have to be charged to the profit and loss account, without prejudice to the provisions of letter l) of article 15 of this Law, or as long as they do not have to be charged to a reserve account if so established by a legal or regulatory norm.

Thus, a transitional regime has been established in the thirty-ninth transitional provision of the LIS to integrate into the tax base those charges and credits on account of reserves that are considered expenses and income, respectively, derived from the first application of Circular 4/2017, dated November 27, insofar as they have tax effects, so that said integration will be carried out in equal parts in the tax base corresponding to each of the first three tax periods beginning on or after January 1, 2018.

Filling in form 200

These entities must make in the boxes [02129] and [02130] "Adjustments for the first application of Circular 4/2017 of the Bank of Spain, to credit institutions ( DT 39 LIS) " on page 13 of form 200, the adjustments derived from the first application of Circular 4/2017:

  • In box [02129] entities must record the amount corresponding to the integration of the charges derived from that first application.

  • In box [02130] entities must record the amount corresponding to the integration of the credits derived from that first application.