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Practical Handbook for Companies 2021

Amount of income to be attributed

Regulation:Article 100.8 and 100.11 LIS

  • To calculate the amount of positive income to be included in the tax base, the principles and criteria established in the LIS and in the other provisions relating to this tax for the determination of the tax base shall be applied.

    For these purposes, the exchange rate in force at the end of the financial year of the non-resident entity in Spanish territory shall be used.

    In no case shall be imputed in excess of the total income of the non-resident entity or the income obtained through the permanent establishment.

    The amount of positive income to be included in the tax base will be determined in proportion to the share in the results and, failing this, in proportion to the share in the capital, equity or voting rights.

  • In the event that the entity transfers its shareholding, directly or indirectly, in order to calculate the amount of the income derived from such transfer, the acquisition value shall be increased by the amount of the company profits which, without effective distribution, correspond to income which would have been imputed to the shareholders as income from their shares or holdings in the period of time between their acquisition and transfer.For these purposes, the amount of the corporate profits referred to above, shall be reduced by 5 per cent for management expenses in respect of such shareholdings.

    In the case of a asset-holding entity under the terms established in article 5.2 of the LIS, the transfer value to be computed will be at least the value of the net assets corresponding to the transferred securities resulting from the last closed balance sheet, once the book value of the assets has been replaced by the value they would have for Wealth Tax purposes or by the market value if this is lower.