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Practical Handbook for Companies 2021

Catholic Church and other churches, denominations and religious communities

Within this section of the partially exempt entities of Article 9.2 of the LIS, special mention should be made of the Catholic Church and other churches, confessions and religious communities.

According to the provisions of the ninth additional provision of Law 49/2002, the Catholic Church and other churches, confessions and religious communities, which have signed cooperation agreements with the Spanish State, may apply the tax regime for non-profit organisations regulated in Title II of the aforementioned Law.

To this effect, the single additional provision of Royal Decree 1270/2003 establishes that these ecclesiastical entities can opt for the regime of non-profit entities of Title II of Law 49/2002.This option can be exercised both through the census return and tacitly through the corporate income tax return.

To be noted:

To opt to apply the special regime of Law 49/2002 through the corporate income tax return you must tick the box [00001] "Non-profit entity under tax regime Title II Law 49/2002" on page 1 of form 200.

The ecclesiastical entities that apply the special regime of Law 49/2002, have the condition of partially exempt entities of article 9.2 of the LIS, so they have obligation to declare all their income, both exempt and non-exempt.

In cases in which these ecclesiastical entities do not opt to apply the tax regime established in Title II of Law 49/2002, they will apply the regime of the partially exempt entities of Article 9.3 of the LIS regulated in Chapter XIV of Title VII of the LIS, being obliged to declare all their income, both exempt and non-exempt, except when they meet the requirements of Article 124.3 of the LIS, in which case they are not obliged to declare.

To be noted:

In the event that ecclesiastical entities apply the regime for partially exempt entities of article 9.3 of the LIS, they should tick the box [00002] "Partially exempt entity" on page 1 of form 200, instead of the box [00001] "Non-profit entity receiving tax regime Title II Law 49/2002".

- Minor entities dependent on a diocese, religious province or ecclesiastical entity integrated in the declaration, previously authorised

In relation to the obligation to declare, ecclesiastical entities have the possibility of to apply in advance to the Ministry of Finance (currently Ministry of Finance and Public Function) for recognition as a corporate taxpayer for entities with a broader scope than that of their legal personality.Thus, once recognised, the taxpayer with the broadest scope (normally a diocese or religious province) will be responsible for all the obligations relating to the tax, and will include those corresponding to the activities and income of the lower entities that depend on that taxpayer.

Remember:

The ecclesiastical entities which, upon request, have obtained recognition as a corporate taxpayer with a broader scope than that of their legal personality (normally dioceses or religious provinces), should tick the box [00078] "Diocese, religious province or ecclesiastical entity that integrates minor entities dependent on them" on page 1 of form 200.

In addition, entities that have ticked box [00078], must complete the section "C) Minor entities dependent on a diocese, religious province or ecclesiastical entity included in the declaration, previously authorised" on page 2 bis of form 200, indicating the tax identification number (NIF) and the name or company name of each of the minor entities that depend on them.