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Practical Manual for Companies 2021.

Completion of the table “Special system of the reserve for investments in the Canary Islands (Law 19/1994)” (page 22 of form 200)

Entities that have applied the RIC in any tax period beginning within the years 2016 to 2021 inclusive, must complete this table as indicated below:

RIC Table:

  • In column "Pending materialization of RIC at the beginning of the period" the amounts by which the tax base was reduced for the years 2016 to 2020 will be recorded, due to the reserve for investments in the Canary Islands that at the beginning of the period have not yet materialized in any of the investments referred to in letters A, B, B bis, C and D of article 27.4 of Law 19/1994.

  • Columns "Applied/materialized in this settlement" will be completed:

    • In column "Investments planned letters A and B of art. 27.4 Law 19/1994" , the amount of those sums by which the taxable base of previous years was reduced since 2016 (accounted for in the following years), which have materialized in the tax period subject to declaration, in any of the investments planned in letters A and B of article 27.4 of Law 19/1994, must be recorded.

    • In column “Investments planned letters B bis, C and D of art. 27.4 Law 19/1994”, the amount of those sums by which the taxable base of previous years has been reduced since 2016 (accounted for in the following years) must be recorded, which have materialized, in the tax period subject to declaration, in any of the investments planned in letters B bis, C and D of article 27.4 of Law 19/1994.

    • In column "Early investments considered materialization of the RIC in this settlement " the amount of those investments made in previous periods or in this same period that are considered early materialization of the RIC in this fiscal year must be recorded.

  • In column "Pending RIC materialization at the end of the period" the amount of the amounts that reduced the tax base and that remain pending materialization at the end of the period must be recorded. According to the provisions of article 27.4 of Law 19/1994, the amounts allocated to the RIC must be materialized within a maximum period of three years, counted from the date of accrual of the tax corresponding to the year in which it was provided.

  • In box [00927] "Amount of the RIC allocation charged to 2021 profits" , you must enter the amount by which the taxable base was reduced in the tax period being declared due to having made the allocation to the reserve for investments in the Canary Islands (accounted for in the following year against the profits of said year), in accordance with the limit and other conditions established in article 27 of Law 19/1994.

    The amount entered in this box [00927] must match the negative adjustment in box [00404] "Reserve for investments in the Canary Islands (Law 19/1994)" on page 13 of form 200.

    Remember:

    Corporate Taxpayers who make the corresponding reduction to the reserve for investments in the Canary Islands , will be required to submit within the deadline established for submitting the Corporate Tax return, the informative declaration approved by Order HAP /296/2016, of March 2, which approves model 282 "Annual informative declaration of aid received within the framework of the Economic and Fiscal Regime of the Canary Islands and other state aid, derived from the application of European Union Law."

Table of early investments:

  • In column "Pending provision for RIC at the beginning of the period" the advance investments of future provisions to the RIC that have been made in the years 2017 to 2020 will be recorded, for which, at the beginning of the period, the RIC has not yet been provided, and this will be done against the benefit of following years.

  • In column "Investments planned letters A and B art. 27.4 Law 19/1994" , the amount of advance investments made in the 2021 financial year pending future allocations to the reserve for investments in the Canary Islands will be recorded (even in the event that the latter are charged to the profits of the 2021 financial year). An early investment is one made prior to obtaining the profit from which the RIC will be allocated, regardless of whether the first allocation of the RIC is made from profits from the year in which it was invested or whether the allocation for that year covers or does not cover the total amount of the early investment. This box will contain the investments made during 2021 in any of those referred to in letters A and B of article 27.4 of Law 19/1994.

  • In column "Investments planned letters B bis, C and D art. 27.4 Law 19/1994" , the amount of advance investments made in the 2021 financial year pending future allocations to the reserve for investments in the Canary Islands must be recorded (even if the latter are charged to the profits of the 2021 financial year). An early investment is one made prior to obtaining the profit from which the RIC will be allocated, regardless of whether the first allocation of the RIC is made from profits from the year in which it was invested or whether the allocation for that year covers or does not cover the total amount of the early investment. This box will contain the investments made during 2021 in any of those referred to in letters B bis, C and D of article 27.4 of Law 19/1994.

  • In column "Pending provision for RIC at the end of the period" the amount of advance investments of future provisions to the RIC that have been made and that, at the end of the period, are still pending to be provided to the RIC against the profit of following years must be recorded, although these provisions must be made against profits until December 31, 2021 .

    Remember:

    In the tax period in which the advance investments are made, the materialization and its financing system must be reported together with the corporate tax return (see section " Documentation to be submitted before the return " in Chapter 1 of this Practical Manual).