RIC case studies
Example 1
In the tax period that began on January 1, 2020, company "A", domiciled in the Canary Islands, makes an allocation to RIC , charged to the profits of the 2020 financial year, in the amount of 1,000 euros. In this same period, said company has profits that are not subject to distribution of 1,000,000 euros.
In 2021, it acquires a material asset for 1,000 euros that contributes to improving the environment in the Canary Islands. In this same period, said company has profits that are not subject to distribution of 1,000,000 euros.
As in fiscal year 2020, in fiscal year 2021 company "A" has profits that are not subject to distribution of 1,000,000 euros.
In this case, the reduction that company "A" may apply to its tax base will be limited to 90 percent of the part of the profit obtained that is not subject to distribution:
Limit: 90% x 1,000,000 euros = €900,000.
Fiscal year 2020 :
Company "A" makes a contribution to the RIC in the amount of 1,000 euros from its 2020 profits (it can make it because it meets the limit, since 1,000 euros < 900,000 euros), therefore You must enter an amount of 1,000 euros in the row "Amount of the RIC endowment charged to 2020 profits" of the table "Special reserve regime for investments in the Canary Islands (Law 19/1994)" on the page 22 of the 200 model.
In addition, must complete on page 13 of form 200, the box [00404] “Reserve for investments in the Canary Islands (Law 19/1994)” (negative adjustment) in the amount of 1,000 euros , since it is the value of the reduction in the tax base for fiscal year 2020 that is made due to the allocation to the RIC.
However, an amount of 1,000 euros remains to be realized in subsequent periods . For this reason, company "A" must complete, in the first table on page 22 of Form 200, column "Pending materialization of RIC in future periods", in the corresponding row to the RIC 2020 for the amount of 1,000 euros .
In accordance with the above, company "A" must complete the adjustment on page 13 and the table on page 22 of form 200 corresponding to the 2020 financial year, as follows:
| Detail of the corrections to the result of the P and G account (page 13 of model 200) | ||||
|---|---|---|---|---|
|
Canary Islands investment reserve (Law 19/1994) |
[00403] |
--- |
[00404] |
1,000 |
Special regime of the reserve for investments in the Canary Islands (page 22 of model 200)
| RIC | Pending materialization RIC at beginning of period | Applied / materialized in this settlement | Pending materialization RIC at the end of the period | ||||
|---|---|---|---|---|---|---|---|
| Planned investments letters A and B, art. 27.4 Law 19/1994 | Planned investments letters B bis, C and D, art. 27.4 Law 19/1994 | Anticipated investments considered materialization of the RIC in this liquidation | |||||
| RIC 2020 | --- | --- | --- | --- | 1,000 | ||
| Amount of the RIC endowment charged to 2020 benefits | |
|---|---|
| [00927] | 1,000 |
Fiscal year 2021 :
Company "A" does not make a provision to the RIC in this year, so will not have to complete the row "Amount of the RIC provision charged to 2021 profits" of the "Regime" table special reserve for investments in the Canary Islands (Law 19/1994)» on page 22 of model 200.
In addition, must not complete the box [00404] “Reserve for investments in the Canary Islands (Law 19/1994)” (negative adjustment) on page 13 of form 200, since it will not be reduced the tax base for the 2021 financial year due to the allocation to the RIC.
Please note that the investment made by company B in fiscal year 2021 is not considered an anticipated investment, since, although RIC is not allocated in 2021, the investment in this fiscal year is a materialization of the provision of the reserve that was made. in 2020.
At the beginning of fiscal year 2021, 1,000 euros remain to be materialized of the allocation to the RIC charged to 2020 profits made in fiscal year 2020, so company "A" must record in the first table on page 22 of Form 200 relating to the Special Regime of the reserve for investments in the Canary Islands (Law 19/1994) column "Pending materialization of RIC at the beginning of the period", in the row corresponding to the RIC 2020 , the amount of 1,000 euros.
The amount invested in the 2021 period is 1,000 euros, so company "A" must complete the first table on page 22 of Form 200 related to the Special Reserve Regime for investments in the Canary Islands (Law 19/1994) stating in column «Investments planned letters B bis, C and D, art. 27.4 Law 19/1994", in the row corresponding to RIC 2020 , the amount of the materialization, that is, 1,000 euros . In fiscal year 2021, the total amount of the provision made during 2020 is materialized, so there is nothing pending to be materialized for future years. For this reason, company "A" should not complete the column "Pending RIC materialization at the end of the period."
In this way, the adjustment on page 13 and the table on page 22 of model 200 corresponding to fiscal year 2021 will be completed as follows:
| Detail of the corrections to the result of the P and G account (page 13 of model 200) | ||||
|---|---|---|---|---|
|
Canary Islands investment reserve (Law 19/1994) |
[00403] |
--- |
[00404] |
0 |
Special regime of the reserve for investments in the Canary Islands (page 22 of model 200)
| RIC | Pending materialization RIC at beginning of period | Applied / materialized in this settlement | Pending materialization RIC at the end of the period | ||||
|---|---|---|---|---|---|---|---|
| Planned investments letters A and B, art. 27.4 Law 19/1994 | Planned investments letters B bis, C and D, art. 27.4 Law 19/1994 | Anticipated investments considered materialization of the RIC in this liquidation | |||||
| RIC 2020 | 1,000 | --- | 1,000 | --- | 0 | ||
| Amount of the RIC endowment charged to 2021 benefits | |
|---|---|
| [00927] | 0 |
Example 2
In the tax period that began on January 1, 2020, company "B", domiciled in the Canary Islands, acquires property, plant and equipment for 1,000 euros that contributes to improving the environment in the Canary Islands.
Company "B" does not make any allocation to RIC in fiscal year 2020.
In 2021, it does not make any investment in which the RIC could materialize, although, with a charge to 2021 profits, company "B" accounts for an allocation to the RIC in the amount of 1,000 euros in 2022.
In both 2020 and 2021, company "B" has profits that are not subject to distribution of 1,000,000 euros.
In both 2020 and 2021, the reduction that company "B" may apply to its tax base will be limited to 90 percent of the part of the profit obtained that is not subject to distribution:
Limit: 90% x 1,000,000 euros = €900,000.
Fiscal year 2020 :
Company "B" does not make a provision to the RIC in this year, so will not have to complete the row "Amount of the RIC provision charged to 2020 profits" of the table " Special regime of the reserve for investments in the Canary Islands (Law 19/1994)» on page 22 of model 200.
In addition, must not complete the box [00404] “Reserve for investments in the Canary Islands (Law 19/1994)” (negative adjustment) on page 13 of form 200, since it will not be reduced the tax base for the 2020 financial year due to the allocation to the RIC.
The amount invested in advance in fiscal year 2020 is 1,000 euros, so it remains to fund the RIC with a charge to profits obtained until December 31, 2023 for this amount. In this case, company "B" will have to complete the table relating to Advance Investments , specifically must be completed Advance investments 2020 row , the box corresponding to column «Forecast investments letters B bis, C and D, art. 27.4 Law 19/1994" for the amount of 1,000 euros , as well as, in that same row, box "Pending RIC provision at the end of the period » worth 1,000 euros . In addition, in fiscal year 2020 must communicate the materialization and its financing system together with the Corporate Tax declaration.
In this way, the adjustment on page 13 and the table on page 22 of model 200 corresponding to the 2020 financial year will be completed as follows:
| Detail of the corrections to the result of the P and G account (page 13 of model 200) | ||||
|---|---|---|---|---|
|
Canary Islands investment reserve (Law 19/1994) |
[00403] |
--- |
[00404] |
0 |
Special regime of the reserve for investments in the Canary Islands (page 22 of model 200)
| Advance investments | Pending to provide RIC at the beginning of the period | Planned investments letters A and B, art. 27.4 Law 19/1994 | Planned investments letters B bis, C and D, art. 27.4 Law 19/1994 | Pending provision RIC at the end of the period |
|---|---|---|---|---|
| Anticipated investments 2020 | --- | --- | 1,000 | 1,000 |
| Amount of the RIC endowment charged to 2020 benefits | |
|---|---|
| [00927] | 0 |
Fiscal year 2021 :
Company "B" makes a contribution to the RIC in the amount of 1,000 euros from the profits of this year (it can make it because it meets the limit, since 1,000 euros < 900,000 euros), therefore You must enter an amount of 1,000 euros in the row "Amount of the RIC endowment charged to 2021 profits" of the table "Special reserve regime for investments in the Canary Islands (Law 19/1994)" on the page 22 of the 200 model.
In addition, must complete on page 13 of form 200, box [00404] “Reserve for investments in the Canary Islands (Law 19/1994)” (negative adjustment) in the amount of 1,000 euros , since it is the value of the reduction in the tax base for fiscal year 2021 that is made due to the allocation to the RIC.
In fiscal year 2021, company "B" does not make any investment , but the investment made will be considered materialized in fiscal year 2021 in 2020 . Therefore, said company must complete in the first table on page 22 of Form 200 relating to the Special Regime of the reserve for investments in the Canary Islands (Law 19/1994) the column «Advanced investments considered materialization of the RIC in this settlement", in the row corresponding to the RIC 2021 , for the amount that is considered materialized in 2021 due to the RIC having been allocated, that is, 1,000 euros.
Company "B" must also complete the table relating to Advance Investments. At the beginning of fiscal year 2021, the RIC is pending provision for an amount of 1,000 euros, due to the anticipated investment that was made in fiscal year 2020. For this reason, company "B" must complete the column "Pending RIC at the beginning of the period", in the row corresponding to the RIC 2020 for the amount of 1,000 euros . The amount invested in 2020 was 1,000 euros and the allocation to the RIC in 2021 was 1,000 euros, so at the end of the 2021 financial year there is no pending provision for RIC for any amount . For this reason, company "B" must not complete the column "Pending provision of RIC at the end of the period", in the row corresponding to RIC 2020 .
In this way, the adjustment on page 13 and the table on page 22 of model 200 corresponding to fiscal year 2021 will be completed as follows:
| Detail of the corrections to the result of the P and G account (page 13 of model 200) | ||||
|---|---|---|---|---|
| Canary Islands investment reserve (Law 19/1994) | [00403] | --- | [00404] | 1,000 |
Special regime of the reserve for investments in the Canary Islands (page 22 of model 200)
| RIC | Pending materialization RIC at beginning of period | Applied / materialized in this settlement | Pending materialization RIC at the end of the period | ||||
|---|---|---|---|---|---|---|---|
| Planned investments letters A and B, art. 27.4 Law 19/1994 | Planned investments letters B bis, C and D, art. 27.4 Law 19/1994 | Anticipated investments considered materialization of the RIC in this liquidation | |||||
| RIC 2020 | --- | --- | --- | --- | --- | ||
| RIC 2021 | --- | --- | --- | 1,000 | --- | ||
| Amount of the RIC endowment charged to 2021 benefits | |
|---|---|
| [00927] | 1,000 |
| Advance investments | Pending to provide RIC at the beginning of the period | Planned investments letters A and B, art. 27.4 Law 19/1994 | Planned investments letters B bis, C and D, art. 27.4 Law 19/1994 | Pending provision RIC at the end of the period |
|---|---|---|---|---|
| Anticipated investments 2020 | 1,000 | --- | --- | 0 |
| Anticipated investments 2021 | --- | --- | --- | --- |
Example 3
In the tax period that began on January 1, 2019, company "C", domiciled in the Canary Islands, acquires property, plant and equipment for 1,000 euros that contributes to improving the environment in the Canary Islands.
Company "C" makes a contribution to the RIC in the amount of 200 euros from its 2019 profits.
In fiscal year 2020, company "C" does not make any investment in which the RIC could materialize, although, out of the profits of this fiscal year, said company makes an endowment to the RIC in the amount of 600 euros.
In fiscal year 2021, company "C" does not make any investment in which the RIC could materialize, although, out of the profits of this fiscal year, said company makes an endowment to the RIC in the amount of 800 euros.
Both in fiscal year 2019 and in fiscal years 2020 and 2021, company "C" has profits that are not subject to distribution of 1,000,000 euros.
Both in fiscal year 2019 and in fiscal years 2020 and 2021, the reduction that company "C" may apply to its tax base will be limited to 90 percent of the part of the profit obtained that is not subject to distribution:
Limit: 90% x 1,000,000 euros = €900,000.
Fiscal year 2019 :
Note: This example assumes that in fiscal year 2019 the table relating to Advance Investments already existed.
Company "C" made a contribution to the RIC in the amount of 200 euros from the profits of this year (it can make it because it meets the limit, since 200 euros < 900,000 euros), therefore must enter an amount of 200 euros in the row "Amount of the RIC 2019 allocation" of the table "Special regime of the reserve for investments in the Canary Islands (Law 19/1994)" on page 22 of form 200 .
In addition, must complete on page 13 of form 200, box [00404] “Reserve for investments in the Canary Islands (Law 19/1994)” (negative adjustment) for the amount 200 euros , since it is the value of the reduction in the tax base for fiscal year 2019 that was made due to the allocation to the RIC.
In 2019, company "C" must complete in the first table on page 22 of Form 200 related to the Special Regime of the reserve for investments in the Canary Islands (Law 19/1994) the column "Advance investments considered materialization of the RIC in this settlement", in the row corresponding to the RIC 2019 , period in which the investment was made, for the amount that was considers materialized in 2019 due to the RIC having been endowed, that is, 200 euros .
The amount invested in advance in fiscal year 2019 is 1,000 euros , as RIC has been allocated in 2019 for the amount of 200 euros, remains to be allocated to the RIC with charged to the profits obtained until December 31, 2022 in the amount of 800 euros. In this case, company "C" must complete the table relating to Advance investments on page 22 of Form 200, specifically, it will have to complete box "Investments anticipated 2019» of column «Planned investments letters B bis, C and D, art. 27.4 Law 19/1994", for the amount of 1,000 euros , as well as column "Pending RIC provision at the end of the period" in the row relating to «2019 advance investments» for the amount of 800 euros . Furthermore, in fiscal year 2019, must communicate the materialization and its financing system together with the Corporate Tax declaration.
In this way, the adjustment on page 13 and the table on page 22 of model 200 corresponding to the 2019 financial year will be completed as follows:
| Detail of the corrections to the result of the P and G account (page 13 of model 200) | ||||
|---|---|---|---|---|
|
Canary Islands investment reserve (Law 19/1994) |
[00403] |
--- |
[00404] |
200 |
| RIC | Pending materialization RIC at beginning of period | Applied / materialized in this settlement | Pending materialization RIC at the end of the period | ||||
|---|---|---|---|---|---|---|---|
| Planned investments letters A and B, art. 27.4 Law 19/1994 | Planned investments letters B bis, C and D, art. 27.4 Law 19/1994 | Anticipated investments considered materialization of the RIC in this liquidation | |||||
| RIC 2019 | --- | --- | --- | 200 | --- | ||
| Amount of the RIC endowment charged to 2019 profits | |
|---|---|
| [00927] | 200 |
| Advance investments | Pending to provide RIC at the beginning of the period | Planned investments letters A and B, art. 27.4 Law 19/1994 | Planned investments letters B bis, C and D, art. 27.4 Law 19/1994 | Pending provision RIC at the end of the period |
|---|---|---|---|---|
| Anticipated investments 2019 | --- | --- | 1,000 | 800 |
Fiscal year 2020 :
Company "C" makes a contribution to the RIC in the amount of 600 euros from the profits of this year (it can make it because it meets the limit, since 600 euros < 900,000 euros), so You must enter an amount of 600 euros in the row "Amount of the RIC endowment charged to 2020 profits" of the table "Special regime of the reserve for investments in the Canary Islands (Law 19/1994)" on the page 22 of the 200 model.
In addition, must complete on page 13 of form 200, box [00404] “Reserve for investments in the Canary Islands (Law 19/1994)” (negative adjustment) in the amount of 600 euros , since it is the value of the reduction in the tax base for fiscal year 2020 that was made due to the allocation to the RIC.
In fiscal year 2020, company "C" does not make any investment , but part of the investment made in 2019 will be considered materialized in fiscal year 2020. Therefore, said company must complete in the first table on page 22 of Form 200 relating to the Special Regime of the reserve for investments in the Canary Islands (Law 19/1994) the column «Advanced investments considered materialization of the RIC in this settlement", in the row corresponding to the RIC 2020 , for the amount that is considered materialized in 2020 due to the RIC having been allocated, that is, 600 euros.
At the beginning of fiscal year 2020, the RIC is pending provision for an amount of 800 euros, due to the anticipated investment that was made in fiscal year 2019 . For this reason, company "C" must complete in the table relating to Advance Investments the column "Pending RIC provision at the beginning of the period", in the row corresponding to RIC 2019 for the amount of 800 euros . The amount invested in advance in fiscal year 2019 was 1,000 euros and the endowment to the RIC in fiscal year 2019 was 200 euros, in 2020 it is 600 euros, so at the end of fiscal year 2020, remains pending to provide RIC in the amount of 200 euros .
In this way, the adjustment on page 13 and the table on page 22 of model 200 corresponding to the 2020 financial year will be completed as follows:
| Detail of the corrections to the result of the P and G account (page 13 of model 200) | ||||
|---|---|---|---|---|
|
Canary Islands investment reserve (Law 19/1994) |
[00403] |
--- |
[00404] |
600 |
| RIC | Pending materialization RIC at beginning of period | Applied / materialized in this settlement | Pending materialization RIC at the end of the period | ||||
|---|---|---|---|---|---|---|---|
| Planned investments letters A and B, art. 27.4 Law 19/1994 | Planned investments letters B bis, C and D, art. 27.4 Law 19/1994 | Anticipated investments considered materialization of the RIC in this liquidation | |||||
| RIC 2019 | --- | --- | --- | --- | --- | ||
| RIC 2020 | --- | --- | --- | 600 | --- | ||
| Amount of the RIC endowment charged to 2020 benefits | |
|---|---|
| [00927] | 600 |
| Advance investments | Pending to provide RIC at the beginning of the period | Planned investments letters A and B, art. 27.4 Law 19/1994 | Planned investments letters B bis, C and D, art. 27.4 Law 19/1994 | Pending provision RIC at the end of the period |
|---|---|---|---|---|
| Anticipated investments 2019 | 800 | --- | --- | 200 |
| Anticipated investments 2020 | --- | --- | --- | --- |
Fiscal year 2021 :
Company "C" will make a contribution to the RIC in the amount of 800 euros from the profits of this year (it can make it because it meets the limit, since 800 euros < 900,000 euros), so must enter an amount of 800 euros in the row «Amount of the RIC endowment 2021» of the table «Special regime of the reserve for investments in the Canary Islands (Law 19/1994 )» on page 22 of model 200.
In addition, must complete on page 13 of form 200, box [00404] “Reserve for investments in the Canary Islands (Law 19/1994)” (negative adjustment) for the amount 800 euros , since it is the value of the reduction in the tax base for fiscal year 2021 that was made due to the allocation to the RIC.
In fiscal year 2021, company "C" does not make any investment , but part of the investment made in 2019 will be considered materialized in fiscal year 2021. Therefore, said company must complete in the first table on page 22 of Form 200 relating to the Special Regime of the reserve for investments in the Canary Islands (Law 19/1994) the column «Advanced investments considered materialization of the RIC in this settlement", in the row corresponding to the RIC 2021 , for the amount that is considered materialized in 2021 due to the RIC having been allocated, that is, 200 euros.
Regarding the table relating to Advance Investments , at the beginning of fiscal year 2021 the RIC is pending provision for an amount of 200 euros, due to the advance investment that was made in fiscal year 2019 . For this reason, company "C" must complete the column "Pending RIC at the beginning of the period" , in the row corresponding to the RIC 2019 for the amount of 200 euros .
The amount invested in 2019 was 1,000 euros and the endowment to the RIC in 2019 was 200 euros, in 2020 it was 600 euros and in 2021 it was 800 euros, therefore, in the table relating to Advance investments There is no pending provision of RIC for any amount at the end of the 2021 financial year. For this reason, company "C" must not complete the box "Pending provision of RIC at the end of the period", in the row corresponding to the RIC 2019.
Although in fiscal year 2021, a total reserve of 800 euros will be allocated , of which 200 euros correspond to the materialization of anticipated investments made in fiscal year 2019 , so would be pending materialization in subsequent periods of an amount of 600 euros . For this reason, company "C" must complete, in the first table on page 22 of Form 200, column "Pending materialization of RIC at the end of the period", in the row corresponding to the RIC 2021 for the amount of 600 euros .
| Detail of the corrections to the result of the P and G account (page 13 of model 200) | ||||
|---|---|---|---|---|
|
Canary Islands investment reserve (Law 19/1994) |
[00403] |
--- |
[00404] |
800 |
| RIC | Pending materialization RIC at beginning of period | Applied / materialized in this settlement | Pending materialization RIC at the end of the period | ||||
|---|---|---|---|---|---|---|---|
| Planned investments letters A and B, art. 27.4 Law 19/1994 | Planned investments letters B bis, C and D, art. 27.4 Law 19/1994 | Anticipated investments considered materialization of the RIC in this liquidation | |||||
| RIC 2019 | --- | --- | --- | --- | --- | ||
| RIC 2020 | --- | --- | --- | --- | --- | ||
| RIC 2021 | --- | --- | --- | 200 | 600 | ||
| Amount of the RIC endowment charged to 2021 benefits | |
|---|---|
| [00927] | 800 |
| Advance investments | Pending to provide RIC at the beginning of the period | Planned investments letters A and B, art. 27.4 Law 19/1994 | Planned investments letters B bis, C and D, art. 27.4 Law 19/1994 | Pending provision RIC at the end of the period |
|---|---|---|---|---|
| Anticipated investments 2019 | 200 | --- | --- | 0 |
| Anticipated investments 2020 | --- | --- | --- | --- |
| Anticipated investments 2021 | --- | --- | --- | --- |