Other non-tax-deductible provisions not affected by article 11.12 LIS

1. Provisions of articles 14.2, 14.3, 14.4 and 14.5 of the LIS

Article 14.2 of the LIS establishes that expenses related to long-term remuneration of staff through defined contribution or defined benefit systems will not be deductible.

However, the contributions for the coverage of contingencies similar to those of pension plans and the contributions made by the promoting companies provided for in Directive 2003/41/ EC of the European Parliament and of the Council, of June 3, 2003, will be deductible, provided that they comply with the requirements provided for in article 14.2 of the LIS.

Likewise, article 14.3 of the LIS establishes the non-deductibility of other expenses associated with provisions :

Those derived from implicit or tacit obligations.
Those concerning the costs of fulfilling contracts that exceed the economic benefits expected to be received from them.
Derivatives of restructuring, except if they refer to legal or contractual obligations and not merely tacit ones.
Those relating to the risk of sales returns.
Those of personnel that correspond to payments based on equity instruments, used as a formula for employee remuneration, and are paid in cash.

Finally, article 14.4 of the LIS establishes the deductibility of expenses corresponding to environmental actions , provided that they correspond to a plan formulated by the taxpayer and accepted by the tax administration.

However, according to the provisions of article 14.5 of the LIS , these expenses are not deductible, either because the regulations establish it that way. or because they have not met the requirements set out in the standard, they will be deductible in the tax period in which the provision is applied or the expense is allocated to its purpose.

Keep in mind:

In relation to the non-deductibility of expenses associated with provisions referred to in article 14.3 of the LIS, the General Directorate of Taxes has resolved that is not deductible in Corporate Tax a provision that aims to cover the risk arising from a possible future compensation in the event of dismissal of workers , since the provision does not respond to a current, legal or contractual obligation, but rather its purpose is to cover the risk arising from a possible future compensation in the event of dismissal of workers. Therefore, the provision will not be a tax-deductible expense in the tax period in which it is provided, given that, at that time, there is no certain obligation to compensate the workers, but rather a simple expectation.

However, according to the provisions of article 14.5 of the LIS, the provision made by the taxpayer will be considered a tax-deductible expense in the tax period in which the provision is applied to its purpose , and not in the tax period in which its accounting allocation was made.

Filling in form 200

The difference between the accounting criteria and the tax criteria on the deductibility of the expenses mentioned in this section gives rise to the following adjustments in boxes [00337] and [00338] "Other provisions not tax deductible (art. LIS) not affected by art. 11.12 LIS" on page 12 of form 200:

In the tax period in which the non-tax deductible expenses are recorded, the taxpayer must include their amount in box [00337] of increases to the result of the profit and loss account.
And in the tax period in which the provision is applied or the expense is allocated to its purpose , the taxpayer must include in box [00338] of decreases, the amount corresponding to said expenses.

2. Provisions of Article 14.7 of the LIS

Article 14.7 of the LIS establishes that expenses related to technical provisions made by insurance entities will be deductible up to the amount of the minimum amounts established by the applicable regulations. Within the same limit, the amount of the allocation in the fiscal year to the stabilization reserve will be deductible in determining the tax base, even if it has not been included in the profit and loss account. Any application of such reserve shall be included in the tax base of the tax period in which it occurs.

Filling in form 200

In application of this precept, the amount of expenses related to technical provisions made by insurance entities as well as the amount of the allocation in the year to the stabilization reserve, which exceed the limit of the minimum amounts established the applicable regulations, must be recorded in box ##1## [00337] ##1##. Likewise, in the tax period in which the insurance entities apply said reserve, they must record its amount in box [00338] .

In the event that the amount of the allocation in the year to the stabilization reserve has not been integrated into the profit and loss account, it will be deductible up to the aforementioned limit, so the amount of the allocation up to the limit must be recorded in box [00338] . In the tax period in which the application of said reserve occurs, this amount must be entered in box [00337].

Remember:

In boxes [00335] and [00336] "Expenses and provisions for pensions not affected by art. 11.12 LIS (arts. 14.1, 14.6 and 14.8 LIS)», only the amounts relating to said expenses that are not affected by the limit established in article 11.12 of the LIS must be recorded.

If they were affected by said limit , their amount would be recorded in boxes [00415] and [00211] "Impairment losses under art. 13.1 LIS and provisions and expenses (arts. 14.1 and 14.2 LIS) referred to in art. 11.12 and DT 33.1 LIS».

3. Provisions of Article 14.9 of the LIS

Article 14.9 of the LIS establishes that expenses inherent to risks derived from repair and review guarantees , will be deductible up to the amount necessary to determine a provision balance not exceeding the result of applying to sales with live guarantees at the end of the tax period the percentage determined by the proportion in which the expenses incurred to face the guarantees in the tax period and in the two previous ones would have been found in relation to the sales with guarantees made in said tax periods.

The provisions of the preceding paragraph shall also apply to provisions for the coverage of incidental expenses for sales returns.

Filling in form 200

Therefore, taxpayers must make a positive adjustment in box [00337] for the amount of those expenses that are not deductible because they exceed the amount established in said provision.

Remember:

In boxes [00337] and [00338] "Other non-tax deductible provisions (art. 14 LIS) not affected by art. 11.12 LIS", only the amounts relating to said expenses that are not affected by the limit established in article 11.12 of the LIS must be entered.