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Practical Manual for Companies 2021.

Deduction for reversal of temporary measures (DT 37.1 LIS)

1. Amount of deduction

For tax periods beginning on or after January 1, 2015, in order to mitigate the effects of the reduction in tax rates on the limitation on the deduction of amortizations corresponding to the years 2013 and 2014, section 1 of the thirty-seventh transitional provision of the LIS , established a new deduction on the full amount for taxpayers who pay taxes at the general corporate tax rate.

Thus, according to the provisions of the aforementioned provision, taxpayers who pay taxes at the general tax rate provided for in article 29.1 of the LIS and to whom the limitation on amortizations established in article 7 of Law 16/2012, of December 27, by which various tax measures aimed at the consolidation of public finances and the promotion of economic activity are applied, will be entitled to a deduction in the total amount of 5 percent (2 percent for tax periods beginning in 2015) of the amounts that they include in the tax base of the tax period in accordance with the third paragraph of the aforementioned article, derived from the amortizations not deducted in the tax periods that began in 2013 and 2014.

Keep in mind:

This deduction will be applied after the other deductions and bonuses that are applicable from the Corporate Tax, so the joint limit does not apply to it.

Amounts not deducted due to insufficient full quota may be deducted in subsequent tax periods, without time limit .

2. Filling in form 200

Taxpayers will enter in box [01040] "Deduction for reversal of temporary measures DT 37.1 LIS " on page 14 of form 200, the amount corresponding to these deductions that apply in the tax period subject to declaration. The amount entered in this box will be the result of completing the breakdown table on page 19 of form 200 explained below.

Completing the table "Deduction for reversal of temporary measures DT 37.1 LIS" ( page 19 of form 200)

This table must contain the amounts of the deduction for the reversal of temporary measures generated in the years 2015 to 2021, as detailed below:

  • In column "Deduction base" the amounts corresponding to the amounts that make up the tax base for the years 2015 to 2021 will be recorded, derived from the amortizations not deducted in the tax periods beginning in 2013 and 2014, and on which the deduction is applied.

  • In column "Amount generated/pending at the beginning of the period" the amounts derived from applying to the amounts in columns "Deduction base" the percentage of 2 percent (for the 2015 tax period) and 5 percent (for the 2016 to 2021 tax periods) will be recorded.

    The row "2021(*)" should only be completed if the entity has deductions pending application, corresponding to a previous tax period starting in 2021.

  • In column "Amount applied" the amounts corresponding to the quantities recorded in the previous column "Amount generated/pending at the beginning of the period" will be recorded, which have been applied in the tax period subject to declaration.

    In box [01040] the total amounts entered in the column "Applied in this settlement" will be recorded, which must be transferred to box [01040] on page 14 of form 200 regarding the settlement of the Tax.

  • In column "Pending amount" the amounts corresponding to the amounts that remain to be applied for future tax periods will be recorded.