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2021 Corporation Tax practical guide.

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 IRC in any tax period that began in the years 2016 to 2021 inclusive must complete this table as follows:

RIC TABLE:

  • In the column "Pending to materialize RIC at the beginning of the period", the amounts in which the base was reduced will be entered tax assessment for the years 2016 to 2020, for the reserve for investments in the Canary Islands that at the beginning of the period have not yet materialized in any of investments referred to in points A, B bis, C and D of article 27,4 of Act 19/1994.

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

    • In the column "Investments foreseen in letters A and B Article 27,4 of Act 19/1994", the amount of those amounts in which the taxable base of the previous years has been reduced since 2016 (allocated in the following years), which have been materialized in the tax period subject to tax declaration, in one of the investments provided for in articles 27,4 of Act 19/1994, point A and B.

    • In the column "Investments foreseen in letters B bis, C and D art. 27,4 Act 19/1994," the amount of those amounts in which the taxable base of the previous years has been reduced since 2016 (allocated in accounting terms in the following years), that, in the tax period subject to tax declaration, have materialized in one of the investments provided for in points B, C and D of article 27,4 of Law 19/1994.

    • In the column "Early investments considered to be the materialization of the IRC in this settlement" , the amount of investments made in the previous periods or in this same period that are considered to be expected to be realised in this financial year must be included.

  • In the column "Pending accrual of the IRC at the end of the period", the amount of the amounts that reduced the gross tax base must be entered and that are pending materialisation at the end of the period. According to article 27,4 of Law 19/1994, the amounts allocated to the IRC must be paid within a maximum period of three years, counted from the date of accrual of the tax corresponding to the financial year in which it was allocated.

  • In box [00927] "Amount of the RIC allocation charged to 2021 profits", it must be stated the amount in which the taxable base was reduced in the tax period subject to tax return due to having made the allocation to the reserve for investments in Canary Islands (allocated in accounting terms in the following financial year against the profits of that financial year), in accordance with the limit and other conditions established in article 27 of Law 19/1994.

    The amount that is obtained in this box [00927] must coincide with the negative adjustment of box [00404] "Reserve for investments in the Canary Islands (Act 19/1994)" on page 13 of Form 200.

    Remember:

    Taxpayers of Corporation Tax who make the reduction corresponding to the Canary Islands investment reserve will be obliged to file within the period established for filing the Corporation Tax return, the informative tax return approved by Order HAP / 296/2016, of 2 March, approving Form 282 "Annual informative tax return on aid received in the framework of the Canary Islands Economic and Tax Regime and other state aid, derived from the application of European Union law. "

Table of early investments:

  • In the column "Pending provision of the IRC at the beginning of the period", the investments of future charges will be recorded in the RIC that they were carried out in the years 2017 to 2020, in respect of which, at the beginning of the period, the IRC has not yet been provided, and will be charged to the benefit of the following years.

  • In the column "Investments provided for in points A and B, article 27,4 of Law 19/1994", the amount of the early investments made in 2021 pending future reserves for investments in the Canary Islands (even if the latter are charged to the profits of the 2021 financial year). The advance investment is that which is made before obtaining the profit from which the IRC will be provided, with regardless of whether the first allocation of the IRC is made against the profits of the year in which it was invested or whether the endowment for that year covers the total of the advance investment. In this box, investments made in any of those referred to in Article 2021 of Act 27,4/19, will be entered in the investments made in 1994.

  • In the column "Investments foreseen in letters B bis, C and D art. 27,4 Act 19/1994", the amount of the early investments made in 2021 pending future reserves for investments in the Canary Islands (even if the latter are charged to the profits of the 2021 financial year). The advance investment is that which is made before obtaining the profit from which the IRC will be provided, with regardless of whether the first allocation of the IRC is made against the profits of the year in which it was invested or whether the endowment for that year covers the total of the advance investment. In this box, investments made in any of those referred to in points B, C and D of Article 2021 of Act 27,4/19 will be entered. 1994

  • In the column "Pending provision of IRC at the end of the period", the amount of the early investments of future charges must be entered to the IRC that had been carried out and that, at the end of the period, they are still pending to provide the IRC against the benefit of financial years these allowances must be made from profit until 31 December 2021.

    Remember:

    In the tax period in which the early investments are made, the materialization and its financing system must be communicated in conjunction with the Corporation Tax return (see the section "Documentation to be presented before the declaration" of Chapter 1 of this Practical Manual).