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Practical Handbook for Companies 2021

Deduction for income obtained in Ceuta and Melilla

In the box [00567] "Allowance for income obtained in Ceuta and Melilla (art. 33 LIS)" on page 14 of form 200, the amount corresponding to the allowance regulated in article 33 of the LIS and which is applied to the gross tax liability must be entered in the following terms:

  • Bonus percentage:

    50 per cent.

  • organizations that it affects:

    Entities that effectively and materially operate in Ceuta and Melilla, i.e. those Spanish entities that are domiciled for tax purposes in those territories or that operate there through an establishment or branch, and those foreign entities that are not resident in Spain and that operate in those territories through a permanent establishment.

  • Subsidised income:

    All income obtained in Ceuta and Melilla.

    Income acquired in Ceuta or Melilla is considered to be that which corresponds to activities that determine the end of a trade cycle with economic results in said territories.

    For these purposes, the requirements of the previous paragraph will be considered met when it comes to leasing property located in these territories.

    Such circumstances shall not be deemed to exist in the case of isolated operations of extraction, manufacture, purchase, transport, entry and exit of goods or effects therein and, in general, when the operations do not in themselves determine income.

    A tener en cuenta:

    Those entities domiciled in Ceuta or Melilla that carry out the activity of exporting goods manufactured in those territories or acquired from a manufacturer in those territories or that had previously imported them, are entitled to a 50% rebate on the part of the tax liability corresponding to the income derived from these operations, as all of them close a commercial cycle that determines economic results in the aforementioned territories.

    A company that engages in transport of goods for hire or reward between Ceuta and the mainland is entitled to the rebate, as this activity closes the economic cycle in Ceuta.If the company has a warehouse on the Spanish mainland from which it sends and receives the goods, provided that the warehouse is not in fact a branch of the transport company, it may apply this relief.

  • Application of this bonus

    For the purposes of applying the relief provided for in this article, income obtained in Ceuta or Melilla shall be deemed to be income obtained in Ceuta or Melilla, provided that the entities have at least one fixed place of business in those territories, up to an amount of 50,000 euros per person employed under a full-time employment contract and performing their duties in Ceuta or Melilla, up to a total maximum limit of 400,000 euros.

    If obtained incomes greater than the said amount will be required to apply the discount that is accredited close in Ceuta or Melilla of a trade cycle that determines economic results.In the case of companies that form part of a group of companies, these amounts are determined at the level of the group.

    Income from wholesale trade shall also be deemed to be obtained in Ceuta or Melilla when this activity is organised, directed, contracted and invoiced through a fixed place of business located in those territories and which has the material and personal means necessary for this purpose.

    In order to determine the income attributable to Ceuta and Melilla in the case of fishing and maritime navigation entities, the specific criteria and percentages established in sections 4 and 5 of article 33 of the LIS will be taken into account.

    Spanish entities domiciled for tax purposes in Ceuta and Melilla which have their effective place of management in those territories, as well as foreign entities not resident in Spain and operating in Ceuta and Melilla through a permanent establishment which effectively and materially operate in those territories, for a period of no less than 3 years, may apply this tax credit for income obtained outside those cities in the tax periods ending after the aforementioned period has elapsed when at least half of their assets are located in those cities.However, income from the letting of immovable property situated outside those territories shall be exempt from the provisions of this paragraph.