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Practical Handbook for Companies 2021

Income not attributable to the taxable base

Regulation: Article 100.4, 100.5 and 100.9 LIS

The following income will not be imputed in the taxable base:

  1. The positive income provided for in letter i) of article 100.3 of the LIS when at least two thirds of the income derived from the credit, financial, insurance or service provision activities carried out by the non-resident entity derives from transactions carried out with unrelated persons or entities within the meaning of article 18 of the LIS.

  2. The income provided for in article 100.3 of the LIS when the sum of their amounts is less than 15 per cent of the total income obtained by the non-resident entity or permanent establishment.

    However, shall in any case be imputed the income referred to in letter i) of Article 100.3 of the LIS without prejudice to the fact that it may also be taken into consideration for the purposes of determining the sum referred to in the previous paragraph.

  3. The income referred to in Article 100.3 of the LIS, when it corresponds to non-deductible expenses of entities resident in Spanish territory.

  4. The dividends or profit shares in the part corresponding to the positive income that has been included in the tax base.For these purposes, the amount of dividends or shares in profits will be reduced by 5 per cent as management expenses relating to such shares, unless the circumstances set out in article 21.11 of the LIS are met.The same treatment will be applied to the dividends on account.